INVESTMENT IN THE STORAGE SECTOR
The upstream side of
the energy business
has already seen
reserves changing hands for
record prices. Now those
premiums are moving
downstream as investors seek
to gain purchase in the
lucrative energy chain. "Any
energy related infrastructure
is very attractive and highly
marketable right now," says
Gunvor Ellingsen, associate
director of oil and gas M&A
firm Scotia Waterous, which
is handling Worldpoint's sale
of its Europoint terminalling
business in the Netherlands.
What's more, buyers are no
longer the usual suspects of
industry operators seeking to
gain market share or secure
strategic assets. The summer
months saw a subsidiary of
the Australian investment
bank Macquarie - Macquarie
International Infrastructure
Fund (MIIF) - buy eight oil
and chemical storage facilities
in Germany from Petroplus
International for €33 million.
This follows on from MIIF's
€45 million acquisition of
TanQuid Tank Storage
Business (TSB), the largest
independent provider of oil
storage services in Germany.
Gavin Kerr, incoming
managing director of MIIF,
sees plenty of attractions in
the tank storage sector, not
least stable and predictable
revenues underpinned by
long term contracts with
credit worthy customers and
the opportunity to extract
operating and structural
synergies. MIIF now plans to
integrate TSB and Petroplus
to increase TSB's market
share to 25%, strip out costs
and optimise revenues. It is
also eying further acquisition
opportunities.
“The tank storage sector is
a fragmented market,” says
Kerr. “TSB and Petroplus
together compose the largest
independent provider of oil
storage services in Germany
yet represent only 25% of
market share. We see the
opportunity for further
synergistic consolidation
acquisitions in this market.”
Macquarie Bank is not
alone. Investment banks,
hedge funds and private
equity houses are also
queuing up to buy into this
market - and they have the
financial muscle to move
valuations to another level.
“With more buyers, the
market is getting very
competitive,” says Ellingsen.
“There's so much cash in the
system but relatively few
opportunities to spend it.”
A case in point is the recent
bidding war for
TransMontaigne Inc, which
saw banking colossus Morgan
Stanley Capital Group outgun
privately-owned midstream
energy player SemGroup.
