The Lone Star hedge fund, 11% owner of Dakota Plains Holdings (DAKP -4.5%), nominates five candidates for election to the company board, seeking to "overhaul corporate governance and maximize stockholder value."
Lone Star says DAKP's poor stock price performance is a direct result of the failures of the CEO and board, citing long histories of destroying stockholder value by CEO and Chairman Adam Kroloff before coming to DAKP.
Canadian Pacific Rail (NYSE:CP) has its first on-the-record allies in its attempt to acquire Norfolk Southern (NYSE:NSC), as oil and gas terminal operator Dakota Plains (NYSEMKT:DAKP) and three other rail customers have filed letters to the U.S. Surface Transportation Board in support of CP.
CP's proposal “introduces a number of positive, future-focused ideas to vastly improve North America’s transportation network,” and a merger “would improve overall service while creating meaningful competition" among the biggest railroads, according to DAKP President Gabe Claypool.
CP has maintained that merging with NSC would increase efficiency by creating a coast-to-coast railroad, reducing the need to exchange cars in congested hubs such as Chicago, and would wring out cost savings and improve service.
Dakota Plains (DAKP -46%) shares are nearly cut in half after the midstream energy company said late Friday that it received a non-compliance notice from NYSE MKT regarding the exchange's continued listing standards due to ~$3.1M in stockholders' deficit.
DAKP says the recognition of the contingent liability for future volumes transloaded through the Pioneer Terminal over the next 12 years was a contributing factor to the stockholders' deficit, and plans to revalue the contingent liability in the next quarter based on actual and forecast volumes.
World Fuel Services (NYSE:INT) agrees to contribute $110M to a compensation fund for victims of the deadly 2013 Lac-Megantic, Quebec, oil train derailment as part of a settlement with the company behind the disaster and its bankruptcy trustees.
A subsidiary of INT sold the light crude oil that was on the train when it crashed and exploded, killing 47 people; the accident has prompted regulators in both Canada and the U.S. to push for stricter rules governing crude-by-rail transport.
The deal leaves Canadian Pacific Railway (NYSE:CP), which transported the oil, as the sole defendant not to settle; Dakota Plains (NYSEMKT:DAKP) says it was a party to the claims through prior joint ventures with INT but that the settlement will conclude and eliminate any legal exposure.
Dakota Plains Holdings (NYSEMKT:DAKP) fell sharply today after publicly questioning the motives of activist investor Lone Star Value Management, which owns ~7.3% of its stock.
DAKP disputed Lone Star's recent efforts to restock the DAKP board with directors, saying "there appear to be no material disagreements concerning the business, the assets, the operations, our safety culture, our environmental record, our cost structure, the balance sheet, any regulatory matters or any strategic transaction."
Dakota Plains (DAKP +25.2%) soars after Lone Star Value Management, the company's largest shareholder with aggregate ownership of ~7.3% of outstanding shares, issues an open letter to DAKP's board which says significant additional value can be created with an MLP structure for the Pioneer transloading facility.
Lone Star says its analysis shows DAKP's assets inside an MLP structure could be valued at $3.55-$4.85/share based on DAKP's earnings potential by year-end 2015 once Pioneer is transporting 80K bbl/day of oil; also, if further capital investment is made so that Pioneer can transport its full facility capacity of 160K bbl/day, DAKP's potential future value in a few years could approach $7.70-$10.20/share inside an MLP structure.
Shares surged Friday on news that expansion of the Pioneer facility remains on schedule and is fully funded.
Dakota Plains Holdings (DAKP +17.9%) surges on news its storage expansion project increasing throughput to 55K bbl/day remains on schedule and fully funded; construction recently was suspended due to winter weather and will resume in the spring.
Canadian Pacific (NYSE:CP) has pledged an expanded rail service to underpin the forecast increases in throughput at DAKP's Pioneer terminal.
For 2015, DAKP says it expects total average throughput of 57.5K bbl/day and an adjusted EBITDA of $23.4M.