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UPDATE 1-Kinder Morgan Energy to buy two tanker cos for $962 mln

Monday, 23 Dec 2013 | 8:25 AM ET

* To buy American Petroleum Tankers and State Class Tankers

* To invest $214 mln to complete the construction of 4 State Class vessels

Dec 23 (Reuters) - Pipeline operator Kinder Morgan Energy Partners LP said it would buy two tanker companies from affiliates of Blackstone Group and Cerberus Capital Management for $962 million to expand its crude and refined products transportation business.

American Petroleum Tankers has a fleet of five product tankers, while State Class Tankers has ordered four. The vessels are scheduled to be delivered in 2015 and 2016.

Kinder Morgan will invest about $214 million to complete their construction, the company said.

The two companies ship crude oil, condensate and refined products in the United States and comply with the Jones Act, a U.S. law requiring all ships moving between U.S. ports to be U.S.-owned, U.S.-made and U.S.-crewed.

"This is a strategic and complementary extension of our existing crude oil and refined products transportation business," said John Schlosser, a Kinder Morgan executive.

The deal is expected to add to the cash available to Kinder Morgan unitholders in the first quarter of 2014, when it is likely to close.

Kinder Morgan units closed at $79.26 on the New York Stock Exchange on Friday.

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