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CVR Energy Makes Binding Offer in Citgo Petroleum Parent Company Auction
Oil refiner CVR Energy, primarily owned by billionaire investor Carl Icahn, has officially placed a binding offer in the ongoing auction for shares in the parent company of Venezuela-owned Citgo Petroleum. According to insiders, Icahn holds a significant 66% stake in CVR Energy, which is headquartered in Sugar Land, Texas.
CVR Energy operates two U.S.-based refineries: the Coffeyville refinery in Kansas, which processes 115,000 barrels per day (bpd), and the Wynnewood refinery in Oklahoma, with a capacity of 75,000 bpd. The auction, taking place under the jurisdiction of a U.S. court in Delaware, aims to settle claims amounting to $21.3 billion from creditors impacted by Venezuela's defaults and expropriations.
To date, the court has received bids from CVR Energy, trading house Vitol, and other entities as part of this unprecedented sale involving one of Citgo’s parent companies. The Citgo Petroleum parent ranks as the seventh-largest oil refiner in the United States.
CVR Energy is leveraging the expertise of investment bankers at Wells Fargo to secure the necessary funds for its bid. The bid is further bolstered by the backing of Icahn Enterprises. Despite repeated attempts for commentary from key personalities, including Icahn Enterprises and CVR's CEO David Lamp, responses remain pending. Wells Fargo also did not immediately respond to requests for comments.
Strategic Fit and Geographic Synergies
According to one insider, CVR Energy's mid-continent oil refineries align well with Citgo’s existing refineries located in Texas, Louisiana, and Illinois. "The bid advantage that CVR has is its synergies to Citgo," the insider disclosed. "Citgo is primarily a Gulf Coast refiner, while CVR operates in the middle of the country."
