Business
Calumet Specialty Products Partners, L.P. Announces Strategic Transactions in its Renewable Diesel Business
Highlights: -- Montana Renewables, LLC carved out as an unrestricted pure-play renewables subsidiary and has purchased Calumet's existing hydrocracker -- $300
About this update from Calumet, Inc
[{"type":"text","content":"Highlights:\n -- Montana Renewables, LLC carved out as an unrestricted pure-play renewables subsidiary and has purchased Calumet's existing hydrocracker\n -- $300 million investment by Oaktree\n -- Additional commercial and strategic partnership discussions continuing\n -- Called 2022 Notes\n\n\nINDIANAPOLIS, Nov. 19, 2021 /PRNewswire/ -- Calumet Specialty Products Partners, L.P. (NASDAQ: CLMT) (\"Calumet\") today announced a series of strategic transactions in connection with its Renewable Diesel business. The transactions establish Montana Renewables, LLC (\"MRL\") as an unrestricted pure-play renewables subsidiary of Calumet. MRL has closed on a $300 million convertible debt investment from funds managed by Oaktree Capital Management, L.P. (\"Oaktree\"). MRL has also closed on a $145 million preferred equity investment by Calumet. Calumet owns 100% of the equity of MRL.\nCalumet's operations in Montana now include two fully independent business lines: Renewables through MRL, and conventional Canadian crude refining through Calumet Montana Refining LLC (\"CMR\").\nMRL will complete its in-flight capital projects and is expected to become one of the most advantaged renewable diesel producers in North America. MRL's existing hydrocracker metallurgy of 317L stainless steel is well-suited for renewable feedstock processing; MRL's unique renewable hydrogen project further lowers carbon intensity and maximizes renewable diesel production; and a new state of the art feedstock pre-treater combined with proximity to temperate oilseeds and low-carbon product markets will provide MRL with significant sourcing and logistics advantages.\nCMR will continue to own and operate the conventional Great Falls Specialty Refinery with a reconfigured processing capacity of 12,000 barrels per day of Canadian crude. The refinery is focused on the production of high-quality Specialty Asphalt, as well as satisfying local demand for conventional fuels. CMR anticipates the refinery will generate 60% of historical (pre-conversion) Adjusted EBITDA after the hydrocracker is separated. Calumet owns 100% of the equity of CMR.\nAs a result of these transactions, Calumet received net cash proceeds of approximately $199 million and has begun to reduce outstanding debt by issuing a notice of redemption today for the $80 million outstanding principal amount of its ...