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Article: MG pays Castle. (MG Corp.; Castle Energy Corp.)
- Article from:
- Futures (Cedar Falls, IA)
- Article date:
- October 1, 1994
- Author:
CopyrightCOPYRIGHT 1994 Summit Business Media. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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When a relationship turns sour, there can be hell to pay. MG Corp., the U.S. subsidiary of the troubled German mining conglomerate Metallgesellschaft A.G., is a case in point.
The company recently agreed to pay Castle Energy in Radnor, Penn., close to $500 million to end a series of ill-advised long-term offtake agreements it entered into with the refiner by Feb. 1, 1995. In the deal, MG exonerates the refiner of $375 million in loans and returns 4.6 million Castle shares, warrants to buy 2 million shares at $11 a share, and a debenture convertible into 500,000 shares. That's $106 million at Castle's current share price of $18.
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