Western Refining Inc. released the preliminary results of its election for the consideration under its merger agreement with Tesoro Corp., where Western Refining, with Tahoe Merger Sub 1 Inc. merging into it, becomes a wholly owned subsidiary of Tesoro.
Western Refining stockholders were given the option to convert each share into either 0.4350 of a share of Tesoro common stock plus cash for any fractional Tesoro share, or $37.30 in cash, according to a May 31 news release.
Based on preliminary information, the cash consideration option became oversubscribed. Western Refining stockholders, who validly elected to receive the cash consideration, will receive cash for about 19% of what they elected, while the remaining shares held by them will be converted into the stock consideration option, assuming the merger is completed on June 1.
The stock consideration will be received by Western Refining shareholders, who opted for said option, as well as those that failed to make a valid election prior to the May 30 deadline.
Based on preliminary prorationing, Western Refining stockholders are set to receive approximately 42,617,757 shares of Tesoro common stock, excluding shares to be issued under certain Western Refining equity awards that vest as a result of the merger, and approximately $404 million in cash upon the merger's completion, the release said.