Why Green Plains Partners Shares Are Surging Today

Green Plains Partners LP GPP shares are gaining Monday morning after entering a definitive merger agreement with Green Plains Inc. GPRE.

Each outstanding common unit of the Partnership not owned by Green Plains and its affiliates will be exchanged for 0.405 shares of Green Plains common stock and $2.00 in cash plus an amount of cash equal to unpaid distributions from the last quarter to the closing date, without interest.

Without taking into account the unpaid distribution amount, the transaction offers approximately $15.69 per Partnership common unit as of September 15, 2023, a 20% premium over the closing price of $13.08 on May 3, 2023, when Green Plains first proposed acquiring the remaining common units.

The merger aims to simplify the corporate structure, boost earnings, and align strategic interests.

The transaction is expected to close in 4Q23. After the merger, the Partnership will become a wholly-owned subsidiary of Green Plains, and its common units will no longer be listed on Nasdaq.

Price Action: GPRE shares are trading lower by 2.49% at $32.90 and GPP higher by 15.673% at $15.94 on the last check Monday.