Carl Icahn’s CVR Energy to Form Refining Partnership

CVR Energy Inc. (CVI), the U.S. oil refiner controlled by billionaire investor Carl Icahn, intends to raise $300 million creating a master-limited partnership for its two plants and related assets after failing to find a buyer.

CVR Refining LP would own the 115,000 barrel-a-day refinery in Coffeyville, Kansas, and the 70,000 barrel-a-day refinery in Wynnewood, Oklahoma, as well as oil pipelines, tanks and a fuel- sales business, according to a filing with the Securities and Exchange Commission today. The $300 million amount is a placeholder used to calculate fees and is subject to change.

The shares rose 6.2 percent to an all-time high of $39.02 at 9:36 a.m. in New York. CVR has more than doubled in value this year. Icahn gained control of the Sugar Land, Texas-based oil refiner in May for $30 a share and the right to an additional payment if he sells the company by Aug. 18, 2013.

CVR said yesterday it was beginning an investigation into an explosion on Sept. 28 at the Wynnewood refinery that killed one employee and critically injured another.

CVR Energy would control CVR Refining through ownership of its general partner, according to the filing. Proceeds may pay debt, according to the filing. U.S. partnerships pay no corporate income tax, leaving more cash for investor payouts.

Icahn, who had criticized CVR for not seeking a buyer, hired Jefferies Group Inc. to run a 60-day sales process, which failed to attract a credible bid, the company said July 26.

Credit Suisse Group AG and Citigroup Inc. are managing the offering of CVR Refining, according to the filing. The company would list as CVRR on the New York Stock Exchange.

To contact the reporter on this story: Jim Polson in New York at jpolson@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net