• Northern Tier unitholders to receive $15 cash and 0.2986 of a Western Refining share in exchange for each Northern Tier common unit
  • Allows Northern Tier unitholders to elect all cash or all stock consideration, subject to proration
  • Merger results in diversified refining asset base with three top tier refineries that have direct pipeline access to advantaged crude oil basins
  • Additional synergies and increased flexibility to sell Northern Tier traditional logistics assets to Western Refining Logistics

EL PASO, Texas and TEMPE, Ariz., Dec. 21, 2015 (GLOBE NEWSWIRE) — Western Refining, Inc. (WNR) and Northern Tier Energy LP (NTI) today jointly announced that they have entered into a merger agreement whereby Western will acquire all of NTI’s outstanding common units not already owned by Western.

Under the terms of the merger agreement, NTI unitholders will receive $15.00 in cash and 0.2986 of a share of WNR common stock for each NTI common unit held. Using the WNR 20-day volume weighted average price as of October 23, 2015 (the last trading day before WNR made its initial offer to acquire all of NTI’s outstanding common units) results in an implied consideration of $28.34 for each NTI unit.  This represents an 18% premium to the 20-day volume weighted average price of NTI’s common unit price as of October 23, 2015.

As an alternative to the cash and stock consideration, each NTI unitholder may elect to receive, per NTI unit, either $26.06 in cash or 0.7036 of a share of WNR.  The election will be subject to proration to ensure that the aggregate cash paid and WNR common stock issued in the merger will equal the total amount of cash and number of shares of WNR common stock that would have been paid and delivered if all NTI unitholders received $15.00 in cash and 0.2986 of a share of Western common stock per NTI common unit.  Upon completion, NTI unitholders are expected to own approximately 15% of WNR. The transaction is expected to close in the first half of 2016.

WNR intends to fund the cash portion of the merger consideration with a combination of cash-on-hand and debt financing. Assuming completion of the proposed transaction, NTI will become a wholly-owned subsidiary of WNR and NTI common units will cease to be publicly traded.  NTI’s 7.125% Senior Secured Notes due 2020 and revolving credit facility are expected to remain in place.

Jeff Stevens, President and CEO of WNR said, “The merger of Western and NTI will result in the combined entity owning three of the most profitable independent refineries on a gross margin per barrel basis, with direct pipeline access to advantaged crude oil combined with an integrated retail and wholesale distribution network. With a simplified corporate structure and diverse geographic base, Western will have greater access to capital and be positioned to profitably grow the company.  We are excited to move forward with this transaction and continue to maximize opportunities to deliver shareholder value.”

Dave Lamp, President and CEO of Northern Tier, added, “The variable distribution MLP model has not been rewarded by the equity market, as evidenced by the historical disconnect between NTI’s high yield and low unit price.  With a simplified corporate structure and diverse geographic base, the new Western will be well positioned to unlock additional value for shareholders.”

Paul Foster will remain Executive Chairman and Jeff Stevens will remain Chief Executive Officer of WNR.  Upon the closing of the transaction, Dave Lamp will be named President and Chief Operating Officer of Western.  The WNR Board of Directors will remain unchanged.

The terms of the merger agreement were approved by the WNR Board of Directors and the Conflicts Committee of the Board of Directors of NTI’s general partner, which negotiated the terms on behalf of NTI. The Conflicts Committee of the Board of Directors of NTI’s general partner is comprised solely of independent directors who retained independent financial and legal advisors in connection with their evaluation of the merger.

The closing of the merger is subject to the satisfaction of customary closing conditions, including the expiration or termination of all waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act and the approval of the merger at a special meeting of NTI unitholders by the affirmative vote of holders of a majority of the outstanding NTI common units (including the NTI common units held by WNR). WNR currently owns approximately 38% of the common units and 100% of the general partnership interest of NTI, and WNR has agreed to vote all of the NTI common units it owns in favor of the merger.

Conference Call and Investor Presentation
There will be a conference call to discuss the proposed merger on Tuesday, December 22, 2015 at 10:00 a.m. Eastern Time. A slide presentation will be available for reference during the conference call.  The call and slide presentation can be accessed on the Investor Relations section of Western’s website, www.wnr.com, and on the Investor Relations section of Northern Tier’s website atwww.northerntier.com.  The call can also be heard by dialing (866) 566-8590 or (702) 224-9819, passcode: 13835929. The audio replay will be available two hours after the end of the call, by dialing (800) 585-8367 or (404) 537-3406, passcode: 13835929.

Goldman Sachs & Co. acted as financial advisor to Western, and Vinson & Elkins, Davis Polk & Wardwell and Richards Layton & Finger acted as legal counsel to Western. Evercore acted as financial advisor to the NTI Conflicts Committee.  Akin Gump Strauss Hauer & Feld LLP and Morris, Nichols, Arsht & Tunnell LLP acted as legal counsel to the NTI Conflicts Committee.

About Western Refining
Western Refining, Inc. is an independent refining and marketing company headquartered in El Paso, Texas. The refining segment operates refineries in El Paso, and Gallup, New Mexico. The retail segment includes retail service stations, convenience stores, and unmanned fleet fueling locations in Arizona, Colorado, New Mexico, and Texas.

Western Refining, Inc. owns the general partner and approximately 66% of the limited partnership interest in Western Refining Logistics, LP (WNRL) and the general partner and approximately 38% of the limited partnership interest in Northern Tier Energy LP (NTI).

More information about Western Refining is available at www.wnr.com.

About Northern Tier
Northern Tier Energy LP (NTI) is an independent downstream energy company with refining, retail and logistics operations that serves the PADD II region of the United States. Northern Tier operates a 97,800 barrels per stream day refinery located in St. Paul Park, Minnesota. Northern Tier also operates approximately 165 convenience stores and supports approximately 102 franchised convenience stores, primarily in Minnesota and Wisconsin, under the SuperAmerica trademark, and a bakery and commissary under the SuperMom’s brand. Northern Tier is headquartered in Tempe, Arizona.

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