Calumet Reveals Series of Transactions at Montana Renewables


   
    

    

   OAKHURST, N.J. (DTN) --- Calumet Specialty Products Partners, L.P. today 
announced Warburg Pincus, a leading global growth investor, has agreed to 
invest $250 million in Montana Renewables LLC in the form of a participating 
preferred equity security, which values MRL at a pre-commissioning enterprise 
value of $2.25 billion.

   The preferred equity investment is not interest-bearing and carriers certain 
minimum return thresholds. In connection with the investment, Warburg Pincus 
will have a representative on MRL's four-member board of managers.

   Calumet also announced that Stonebriar Commercial Finance has invested an 
additional $350 million through a pair of sale and leaseback contracts on top 
of its existing $50 million commitment to MRL. The sale and leaseback 
transactions carry an approximate 12.3% cost of capital and offer certain 
strategic early termination options. Concurrent with these transactions, the 
$300 million convertible investment from Oaktree Capital Management L.P. in MRL 
has been retired.

   Today's transactions are accretive in the aggregate. MRL's pro forma 
liquidity, after giving effect to these transactions, is approximately $300 
million.

   Once fully operational, Montana Renewables, based in Great Falls, Montana, 
will use waste feedstocks to produce low-emission alternatives that directly 
replace fossil fuel products including renewable hydrogen, renewable diesel and 
sustainable aviation fuel. RD and SAF created by catalytic hydroprocessing of 
renewable feedstocks significantly reduce the carbon footprint of hard to 
electrify industries.

   "This investment will accelerate our mission to quickly produce low-emission 
alternatives that directly replace fossil fuel products. We are pleased to 
partner with Warburg Pincus, a world class institutional investor, as well as 
to extend our longstanding multi-site relationship with Stonebriar," said Bruce 
Fleming, EVP Montana Renewables and Corporate Development. "We would also like 
to extend our gratitude to Oaktree for their initial investment in MRL. 
Oaktree's alignment and support of our vision allowed the launch of this 
business in 2021. Today's announcement of increased capitalization further 
solidifies MRL's go-forward business plan to increase capacity in 2024-2025 to 
an estimated 18,000 barrels per day, including the optionality to convert a 
large portion of the plant's production from RD to SAF."




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