Plains All American Pipeline LP, the pipeline company that ships more than 3 million barrels a day over its network, withdrew a $1 billion unsolicited offer to buy rival SemGroup Corp. after being rebuffed by the board.
Plains didn’t give a reason for dropping the $24-a-share cash offer and said in a statement today it wouldn’t comment further. SemGroup’s shares haven’t closed below $24.75 since the bid was announced. In December, Houston-based Plains agreed to buy BP Plc’s natural gas liquids network in Canada for $1.67 billion in cash.
Plains, which owns 16,000 miles (25,750 kilometers) of pipelines, disclosed the offer in an Oct. 24 letter to SemGroup’s management. Tulsa, Oklahoma-based SemGroup rejected Plains’ offer Oct. 19, saying it was too low.
SemGroup, which owns 2,800 miles of pipelines and storage terminals that can hold 18.1 million barrels of fuel, adopted a shareholder rights plan in October that would make it more difficult for an acquirer to buy more than 10 percent of the company without the board’s approval.
Liz Barclay, a spokeswoman for SemGroup, and Roy Lamoreaux, a spokesman for Plains, didn’t return phone messages seeking comment.
Plains rose 0.4 percent to $79.51 at the close in New York. SemGroup gained 1.1 percent to $29.90.