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Upstream master limited partnership (MLP) Legacy Reserves has received a $435 million buyout offer from private equity giant Apollo Management. If successful, the deal would break the silence between private equity and the energy industry that took hold of the market last fall.
On Friday, Legacy's general partner received a buyout proposal from Apollo in which the private equity firm offered to purchase Legacy's 31 million outstanding units for $14 per unit -- a 40% premium to the MLP's closing share price last week.
Legacy stated in a press release that it expects management to sign off on the deal should the board of directors approve the transaction.
Under the proposal, Apollo offered Legacy's executives the opportunity to invest in the resulting partnership. The management team currently holds a 21% stake in Legacy.
The entire Legacy staff is also to remain employed by the newly formed firm.
In a note...