Kinder Morgan in $22 B Deal

Elena
28 Aug, 2006
New York City

The offer represents a 5.7% premium over the company''s closing stock price on Friday and a 27% premium over the closing price on May 26, the last trading day before the investor group made its proposal. The deal is expected to close at the beginning of 2007.

[R]8:00AM Natural-gas pipeline operator Kinder Morgan to be bought for $22 billion.[/R]
Kinder Morgan ((KMI)), Houston-based energy-transportation-and-storage company, agreed to be acquired by a group of investors including its chief executive for $15 billion plus the assumption of $7 billion in debt. Members of the buyout group include Chairman and CEO Richard D. Kinder, company co-founder Bill Morgan, other members of management and the board of directors, and investment companies Goldman Sachs Capital Partners, American International Group Inc., Carlyle Group and Riverstone Holdings LLC. Richard Kinder, who will continue as chairman and CEO of Kinder Morgan, is expected to reinvest all of his 24 million company shares.

The offer represents a 5.7% premium over the company''s closing stock price on Friday and a 27% premium over the closing price on May 26, the last trading day before the investor group made its proposal. Under terms of agreement, Kinder Morgan shareholders will receive $107.50 for each share of stock they hold. The deal is expected to close at the beginning of 2007.


[R]7:30AM Asian markets finished mostly lower on U.S economic slowdown.[/R]
Asian markets finished mostly lower. Japan''s Nikkei 225 Average edned 1.1% lower at15762.59. Hong Kong''s Hang Seng Index finished 0.2% lower at 16922.29, South Korea''s Kospi Index sank 0.11% to 1327.89, and Taipei fell 1.25% to close at 6444.76. Australia''s S&P/ASX 200 was flat, rising 0.01% to 5024.20, while the Shanghai Composite Index bucked the trend to end 1.7% higher at 1650.44, hitting its biggest single-day rise in the past two weeks.

Internet-related stocks, autos and electronics issues led the decliners. Softbank plunged 5.6%, while Toyota Motor shed 0.5%. Sony slipped 0.6%. Declining sectors also included machinery makers and pharmaceuticals, with Sumitomo Heavy Industries losing 2.6% and Chugai Pharmaceutical shedding 1.8%.

In Hong Kong, Hutchison Whampoa, fell 1.7%, while Sinopec, rose 0.2%. In South Korea, shares ended flat as declines from banking and brokerage issues were counterbalanced by gains in shares of shipbuilders. Kookmin Bank shed 0.6% and Shinhan Financial Group dropped 0.7%. Shipbuilders Hyundai Heavy Industries and Samsung Heavy Industries gained respectively 1.3% and 0.5%.

In Taiwan, shares closed at their lowest level in three weeks on domestic political worries and foreign-equity outflows. Huaku Construction fell 6.1%, and Hung Poo Real Estate Development dropped 5.8%. In Australia, the stock market ended in quiet trading as investors awaited more news from the corporate earnings season.


[R]6:30AM European markets were lower Monday morning on oil, banks.[/R]
European markets were lower by mid-morning on Monday. Broadly the French CAC 40 index dipped 0.4% at 5,091 and the German DAX 30 index fell 0.4% at 5,788 as the U.K. market remained closed Monday due to a bank holiday. The energy sector was hit, forcing Norsk Hydro down 1.2% and rival Statoil 1.1%. Banca Intesa and Sanpaolo IMI both pulled back from some of the previous week''s gains after they approved the outline of a merger plan over the weekend. Shares in Banca Intesa fell 1.5% as Sanpaolo IMI gave up 1.4%.

Other European banks also fell. Capitalia shed 1% in Italy and BNP Paribas slipped 0.8% in Paris, while Commerzbank added 1.1% in Frankfurt. In other corporate news, Unilever gained 0.4% in Amsterdam after the group agreed to sell the majority of its European frozen food business to Permira Funds for 1.73 billion euros ($2.21 billion).

Oil prices dipped Monday as concerns eased about threats to U.S. oil supply after a storm in the Caribbean weakened. Light sweet crude for October delivery fell 76 cents to $71.75 on the NYME. Gold was trading at $622.70 an ounce, up 45 cents from Friday''s close. The euro was higher against the U.S. dollar on Monday as investors examine whether European interest rates are likely to rise faster than those in the United States.

The euro bought $1.2794 in early European trading, up from $1.2758 in New York on Friday, regaining some of the ground it lost last week. The British pound gained to $1.8910 from $1.8868 on Friday, while the dollar slipped to 117.11 Japanese yen from 117.24 yen.