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Delek US Holdings completes acquisition of Alon USA

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Hydrocarbon Engineering,

Delek US Holdings Inc. has announced the closing of the acquisition of the remaining outstanding shares of Alon USA Energy Inc. common stock in an all-stock transaction.

Under the terms of the agreement, the owners of the remaining outstanding shares in Alon will receive a fixed exchange ratio of 0.5040 Delek US shares for each share of Alon, with cash paid in lieu of fractional shares.

Prior to this transaction, Delek US owned approximately 33.7 million shares of the common stock of Alon.

Following closing, Delek US will have approximately 82.0 million shares outstanding.

Uzi Yemin, Chairman, President and CEO of Delek US, said: “With the transaction now complete, I want to welcome the Alon employees, and we look forward to integrating Alon’s operations into Delek. We will be focused on working together to grow the combined organisation and achieve meaningful synergies across the business. The combined refining operation will be one of the largest buyers of crude from the Permian Basin among the independent refiners. We also will have the ability to unlock additional value with an estimated US$70 million to US$85 million of annual logistics EBITDA from Alon’s assets through future potential drop downs to Delek Logistics Partners. The combined company will create a platform for future logistics projects to support a larger refining system.”

Yemin added: “We believe this strategic combination creates a larger, more diverse company that is well positioned to take advantage of opportunities in the market and better navigate the cyclical nature of our business. Our strong financial position, combined with the ability to achieve US$85 million to US$105 million of expected synergies and unlock logistics value, should allow our capital allocation program to include initiatives to improve operations, take advantage of growth opportunities and return cash to shareholders, as we work to drive long-term value creation for our shareholders.”

The combined company will primarily be led by Delek US’ management team, with Uzi Yemin serving as Chairman, President and CEO, Fred Green as Executive Vice President and COO, and Kevin Kremke as Executive Vice President and CFO.

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