Southcross Energy Partners LP (NYSE:SXE) Investor Investigation Over Possible Wrongdoing In Acquisition Announced

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Company Name(s): 
Southcross Energy Partners
Affected Securities: 
NYSE: SXE

An investigation on behalf of investors, who currently hold units of Southcross Energy Partners LP (NYSE:SXE), was announced concerning whether the takeover of Southcross Energy Partners LP by American Midstream Partners, LP is unfair to NYSE:SXE unitholders.

The investigation by a law firm concerns whether certain officers and directors of Southcross Energy Partners LP breached their fiduciary duties owed to NYSE:SXE investors in connection with the proposed acquisition.

On November 01, 2017, Southcross Energy Partners, L.P. (NYSE:SXE) announced that it has signed an agreement with American Midstream Partners, LP (NYSE:AMID) whereby American Midstream Partners, LP has proposed to merge Southcross Energy Partners LP (NYSE:SXE into a wholly owned subsidiary of American Midstream Partners, LP and that Southcross Holdings, LP (collectively, withSouthcross Energy Partners LP referred to as “Southcross”) has entered into a separate agreement with American Midstream Partners, LP whereby American Midstream Partners, LP will acquire certain assets of Southcross Holdings. The two separate transactions are valued in the aggregate at approximately $815 million, including the repayment of net debt. Under the terms of the proposed transaction public unitholders of Southcross Energy Partners LP (NYSE:SXE) will receive 0.160 American Midstream Partners, LP (NYSE:AMID) common units for each SXE common unit in a unit-for-unit merger. Based on a closing price of $13.55 per NYSE:AMID unit on October 31, 2017, NYSE:SXE untiholders will receive a value of approximately $2.17 per NYSE:SXE unit.

However, given that at least one analyst has set the high target price for NYSE:SXE units at $2.75 per unit, the investigation concerns whether the offer is unfair to NYSE:SXE unitholders. More specifically, the investigation concerns whether the Southcross Energy Partners Board of Directors undertook an adequate sales process, adequately shopped the company before entering into the transaction, maximized shareholder value by negotiating the best price, and acted in the shareholders' best interests in connection with the proposed sale.