Parallel Petroleum Corporation says that PLLL Holdings, LLC and PLLL Acquisition Co., entities formed for the purpose of acquiring Parallel Petroleum Corporation, have commenced a tender offer to acquire all of the outstanding shares of Parallel’s common stock, including the associated rights to purchase preferred stock (collectively, the “Shares”), for $3.15 per Share in cash, net to holders of Shares without interest and less any applicable withholding taxes. The offer was commenced in accordance with the previously announced Agreement and Plan of Merger, dated as of September 15, 2009, entered into by PLLL Holdings, LLC, PLLL Acquisition Co. and Parallel Petroleum Corporation. PLLL Holdings, LLC and PLLL Acquisition Co. are wholly-owned subsidiaries of an affiliate of Apollo Global Management, LLC, a leading global alternative asset manager. The aggregate value of the proposed transaction is approximately $483 million, excluding transaction fees and expenses.

Upon the successful closing of the tender offer, stockholders of Parallel will receive $3.15 in cash for each Share tendered in the offer, without interest and less any applicable withholding taxes. Following completion of the tender offer, under the terms of the merger agreement, if required, PLLL Acquisition Co. will complete a second-step merger in which any remaining Shares will be converted into the right to receive the same per Share price paid in the tender offer.

The tender offer is conditioned upon, among other things, (i) there being validly tendered and not withdrawn prior to the expiration of the tender offer a number of Shares that represents at least a majority of the then outstanding Shares, and (ii) the waiting period, if required, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, having expired or been terminated.

PLLL Acquisition Co. and PLLL Holdings, LLC are filing with the Securities and Exchange Commission (the “SEC”) a tender offer statement on Schedule TO that provides the terms of the tender offer. Parallel is also filing with the SEC a solicitation/recommendation statement on Schedule 14D-9 that includes the recommendation of Parallel’s board of directors that Parallel stockholders accept the tender offer and tender their shares to PLLL Acquisition Co. As previously disclosed, the board of directors of Parallel has unanimously approved the transaction.

The tender offer will expire at midnight New York City time on October 22, 2009, unless extended in accordance with the terms of the merger agreement and the applicable rules and regulations of the SEC. The offer to purchase and related documents in connection with the tender offer contain other important terms and conditions with respect to the tender offer and should be carefully reviewed by stockholders.

Jeffrey Shrader, Parallel’s Chairman of the Board, commented, "As I stated in our September 15, 2009 press release, which announced the Agreement and Plan of Merger, the Board considered a range of potential alternatives, including continuing to operate as an independent entity, the returns and dilution associated with issuing additional equity in a public or private offering, the possibility of the sale of certain assets, and combinations with other merger partners. After conducting an exhaustive evaluation of recapitalization and corporate sale alternatives, our board of directors unanimously concluded, after in-depth consideration, that this transaction with Apollo is in the best interests of our shareholders.”

Tags: Parallel Petroleum Corporation