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From the Wall Street Journal

The former chief executive of MarkWest Energy Partners is looking to scuttle one of the largest energy deals of the year, saying that the company’s shareholders are coming up short in the transaction now valued at roughly $10 billion.

John Fox helped found MarkWest in 1988 and later served as chairman and chief executive of the company, which processes and transports natural gas and related fuels. He says that the proposed acquisition of MarkWest by a company controlled by refiner Marathon Petroleum Corp. is bad for shareholders, who will get smaller dividends after the deal.

Marathon would benefit from the transaction, because it would reap high fees from the combined partnership, Mr. Fox said in an interview, but MarkWest investors would do better with a stand-alone company. “We have more growth opportunities ahead of MarkWest today than any possible combination could provide,” he said.

Mr. Fox has delivered a letter outlining his concerns to MarkWest’s board and Chief Executive Frank Semple, and said he plans to mount a campaign to sway other shareholders. The company will hold a special meeting to vote on the transaction on Dec. 1.

MarkWest didn’t immediately respond to request for comment.

Under the terms of the deal struck in July, MarkWest investors would receive 1.09 shares of Marathon’s pipeline partnership, MPLX LP, and $3.37 in cash per share. That made the deal worth $15.8 billion. But MPLX shares have fallen sharply, so the total consideration for the deal is now valued at about $50 a share based on Tuesday’s prices, compared with more than $78 when it was first announced.

Analysts have speculated that Marathon might have to sweeten its offer, as the 32% premium implied by the initial deal has faded away. Jay Hatfield, a portfolio manager of the Infrastructure MLP ETF, which owns share in both MarkWest and MPLX, said the combination boosts Marathon Petroleum at the expense of both partnerships, though he said mounting an opposition campaign is a long shot.

Mr. Fox, who retired as chief executive in 2003 and stepped down from the board in 2010, said he owns or controls more than 1.3 million shares of MarkWest. That is less than 1% of the company.

Marathon didn’t immediately respond to a request for comment. But its chief executive, Gary Heminger, told analysts last week that he thinks “this deal is still very, very compelling.”

The same forces that have pummeled shares of Marathon’s partnership could also make it harder for MarkWest to remain alone or find a better buyer. Morgan Stanley analyst Evan Calio wrote recently that the outlook for MarkWest is bleaker than it was a few months ago because partnerships that own energy infrastructure have been battered by investors and are having a harder time raising money.