Palladium Buying American Gilsonite

Palladium Equity Partners has agreed to acquire American Gilsonite Co. (OTC BB: AGTC), a Palo Alto, Calif.-based miner and producer of a variety of asphaltite called uintaite. The deal is valued at $74 million, and is expected to close this month. The Breckenridge Group advised ACG on the deal.

 

PRESS RELEASE

 

American Gilsonite Company (Pink Sheets:AGTC)(“AGC”), a leading provider of high-quality Gilsonite and Gilsonite products and services through it and its predecessors since 1888, today announced a definitive agreement pursuant to which AGC will be acquired by American Gilsonite Holding Company. American Gilsonite Holding Company, which was formed for the purposes of the acquisition transaction, is a privately held, portfolio company of Palladium Equity Partners III, L.P. (“Palladium”). Under terms of the agreement, American Gilsonite Holding Company, through a wholly owned subsidiary, will acquire AGC for $74 million in cash subject to certain adjustments. The acquisition is expected to close once all closing conditions have been satisfied which the parties anticipate will occur during March, 2008.

Both companies' Boards of Directors have approved the transaction. Subject to regulatory approval and other customary closing conditions, AGC anticipates completing the transaction in its first quarter ending March 31, 2008. The combined companies will continue to operate under the American Gilsonite Company name and brand.

AGC retained The Breckenridge Group, Inc. as its financial advisor and Greenberg Traurig, LLP as its legal advisor. American Gilsonite Holding Company relied on Palladium as its financial advisor and O'Melveny & Myers LLP as its legal advisor.

About American Gilsonite Company

AGC operates as an industrial minerals company and is the world's primary miner and processor of uintaite, a variety of asphaltite, a specialty hydrocarbon which AGC markets to industrial customers under its registered trademark name “Gilsonite(R: 57.61, -1.67, -2.81%)”. Gilsonite is a glossy, black, solid naturally occurring hydrocarbon similar in appearance to hard asphalt and is believed to be found in commercial quantities only in the Uinta Basin in northeastern Utah. Because of its unique chemical and physical properties, Gilsonite has been used in more than 160 products. The Company sells its products to customers in four primary markets: (i) oil and gas, (ii) inks and paints, (iii) foundry and (iv) asphalt. AGC is headquartered in Palo Alto, CA, with its mines, offices and staff in Bonanza, Utah. AGC's website can be accessed at www.americangilsonite.com.

About American Gilsonite Holding Company

American Gilsonite Holding Company, which was formed for the purposes of the acquisition transaction, is a privately held, portfolio company of Palladium Equity Partners III, L.P.

About Palladium Equity Partners

Palladium Equity Partners, LLC (www.palladiumequity.com) is an investment firm targeting companies in manufacturing, services, food, consumer, healthcare and media. Formed in 1997, Palladium currently has capital under management in excess of $750 million.