Calumet buying Royal Purple for about $335 million

Indianapolis-based Petroleum refiner Calumet Specialty Products Partners LP is buying high-performance lubricants maker Royal Purple Inc. for about $335 million, the companies announced Wednesday morning.

Calumet shares climbed 5 percent in morning trading on word of the deal.

Porter, Texas-based Royal Purple makes lubricants mostly for automotive, industrial, marine, motorcycle and racing applications.

Calumet said Wednesday that it will fund the deal with available cash, borrowings under a senior secured revolving credit facility and possibly other long-term debt financing.

The transaction is targeted to close by the middle of July.

Last month, Calumet reported that its first quarter profit climbed to $51.9 million on $1.2 billion in sales. Also last month, the company announced plans to expand its Indianapolis headquarters, adding 48 jobs to its current local work force of 75 by 2015.

Shares of Calumet gained $1.07, or 5 percent, to $22.75 in morning trading Wednesday. It shares traded as high as $27.74 in early May. Their 52-week low was $15.99 set in October 2011.

Calumet began operations in 1990 with the acquisition of a specialty lubricants refinery in northwest Louisiana and a distribution terminal in Burnham, Ill. The company now operates five additional plants in Louisiana, Pennsylvania, Texas, Wisconsin and Missouri.

The company raised more than $150 million in a secondary stock offering last month to help fund growth.

 

Please enable JavaScript to view this content.

Story Continues Below

Editor's note: IBJ is now using a new comment system. Your Disqus account will no longer work on the IBJ site. Instead, you can leave a comment on stories by signing in to your IBJ account. If you have not registered, please sign up for a free account now. Past comments are not currently showing up on stories, but they will be added in the coming weeks. Please note our updated comment policy that will govern how comments are moderated.