AmeriGas Partners news about a deal with UGI (NYSE:UGI) has APU stock heading higher on Tuesday.
AmeriGas Partners (NYSE:APU) announced today that it has entered into a deal with UGI that will have it merging with the company. This will have UGI acquiring all 69.20 million publicly held shares of APU that it doesn’t already hold.
The AmeriGas Partners news includes UGI making an offer that includes a mix of its own shares and cash for APU stock. This will have offering .50 shares of UGI stock and $7.63 in cash for each share of APU stock.
The offer from UGI for shares of APU stock represent a 13.5% premium to its closing price on Monday. It is also a $21.9% premium over the 30-day volume weighted average price for the stock.
If all goes well with the deal, then AmeriGas Partners will become a wholly-owned subsidiary of UGI. It’s also worth noting that UGI already has a 26% stake in the company.
“After conducting a comprehensive review of strategic alternatives, both the AmeriGas and UGI Boards determined that a merger of AmeriGas was the most compelling next step in our development,” Hugh Gallagher, President and CEO of AmeriGas Partners, said in a statement. “The transaction with UGI supports a strong and stable AmeriGas and empowers a focus on growth opportunities.”
The AmeriGas Partners news release states that the companies are expecting the deal to close in the fourth quarter of 2019.
APU stock was up 11% and UGI stock was down 6% as of Tuesday morning.
As of this writing, William White did not hold a position in any of the aforementioned securities.