Top Energy Stocks
Energy stocks were sharply higher, with the NYSE Energy Sector Index rising more than 1.9% while shares of energy companies in the S&P 500 were up 1.9% as a group. Crude oil for May delivery was up $2.34 to $55.63 per barrel while May natural gas futures were up 7 cents to $2.60 per 1 million BTU.
In company news, Delek US Holdings ( DK ) rose Wednesday after the refinery company last night said it was acquiring a 48% stake in rival Alon USA Energy ( ALJ ) through a $572.4 million cash-and-stock transaction.
Under terms of the stock purchase agreement, DK will receive 33.7 million ALJ shares in exchange for $345 million in cash and 6 million shares of its stock. A portion of cash payment will be structured as a five-year promissory note issued to ALJ corporate parent, Alon Israel, which is also eligible for up to 200,000 additional DK shares under certain conditions.
The deal is expected to close during the second half of this year, subject to regulatory and other third-party approvals.
DK shares recently were up almost 3% at $38.95 apiece, backing down from a session high of $40.34 a share. The stock has traded within a 52-week range of $25.15 to $41.15 a share, already posting a 21% gain over the past 12 months prior to Wednesday's increase.
ALJ recently turned lower in Wednesday trade, dropping nearly 1% to $15.55 a share after earlier climbing to a session high of $16.64 a share.
In other sector news,
(+) EVEP, (+13.2%) Raised to Outperform from Sector Perform at RBC Capital Markets, which also increased its price target for the stock by $2 to $22 a share.
(-) HNR, (-15.1%) Said discussions with PDVSA seeking an amicable exit from Petrodelta "have not yet led to any offer or terms that would be remotely fair and equitable to HNR shareholders."
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