Investment funds Nut Tree Capital Management and Caspian Capital have proposed to take Nasdaq-listed Martin Midstream Partners (MMLP) private in an all-cash deal valued at $4 per share or $156m.
Martin Midstream Partners, which operates as a limited partnership, is a diversified speciality services midstream business with operations located along the US Gulf Coast.
In May 2024, the midstream firm received a buyout offer of $3.05 per share in cash from Martin Resource Management (MRMC).
The proposal by Nut Tree Capital Management and Caspian Capital represents a 31% premium over the offer made by Martin Resource Management. It is also a 23% premium over the closing price of Martin Midstream Partners’ common units on 9 July 2024.
Martin Resource Management’s fully owned entity Martin Midstream GP is the general partner of Martin Midstream Partners.
Nut Tree Capital Management and Caspian Capital said that they had issued a letter to the conflicts committee of the board of directors of Martin Midstream GP regarding their proposal.
The investment funds announced that their proposal is fully funded with available capital and is not contingent on any financing conditions.
Both are current investors in Martin Midstream Partners’ debt and are said to have extensive experience in the oil and gas industry.
The duo indicated that they are well-versed in Martin Midstream Partners, its operations, and capital structure, having thoroughly reviewed all publicly available information about the midstream firm.
Nut Tree Capital Management chief investment officer Jed Nussbaum and Caspian Capital partner David Corleto said: “We believe our premium, all cash proposal would bring compelling and immediate value to unitholders of MMLP significantly in excess of MRMC’s concerning and clearly conflicted offer.
“Notwithstanding our multiple attempts, the Conflicts Committee has thus far refused to meet with us regarding the merits of our proposal except to inform us that it would not engage with us unless the General Partner were to support our proposal, a step that we view as highly irregular given the interconnected relationships between MRMC, the General Partner, and MMLP.”
Based in Texas, Martin Midstream Partners is engaged in terminalling, processing, and storage services for petroleum products and by-products. It is also involved in land and marine transportation services for petroleum products and by-products.
Additionally, the firm undertakes marketing, distribution, and transportation services for natural gas liquids among others.
