Dutch commodities trader Louis Dreyfus Commodities BV and US hedge fund Highbridge Capital Management LLC have agreed to dispose of their energy trading joint venture Louis Dreyfus Highbridge Energy LLC (LDH Energy) to two investor groups, the target firm said on Thursday, without revealing financial terms.
The new owners will be DF Energy Acquisition LLC, a private investment firm owned by Glenn Dubin, and a group of strategic and financial investors including investment vehicles of family trusts created by Paul Tudor Jones and Timothy Barakett, as well as Continental Grain Company / Paul Fribourg. They will have non-operating positions with the company.
LDH Energy’s chairman and CEO William C Reed II welcomed the agreement, saying it opens a new chapter in the company’s future growth, aimed at increasing its merchant footprint and expanding asset portfolio. The experience in global finance and industry and the fresh vision of the new owners are a guarantee for great growth prospects, Reed added.
Louis Dreyfus Commodities Group said it would focus on its core business as a global commodities group, while remaining a minority investor in LDH Energy.
Glenn Dubin, who is also co-founder and chairman of Highbridge Capital and served in the board of LDH Energy for the past five years, pointed out that the target firm had built a strong operating platform supporting a diversified energy business that is well positioned for future growth.
Once the transaction closes, LDH Energy will operate under the new name Castleton Commodities International LLC, keeping its management team, but with a new board.
Completion is expected by the end of the year, subject to conditions.
DF Energy Acquisition LLC received advice from Davis Polk & Wardwell LLP and Bank of America Merrill Lynch. The investor group was advised by Sullivan & Cromwell LLP, while Willkie Farr & Gallagher LLP advised Highbridge Capital Management and Cohen & Gresser LLP advised LDH Energy’s management team.