US-based refined petroleum supplier Global Partners has formally agreed to pay Warex Terminals $47.5 million (33 million) for three terminals in New York.
Global Partners and Warex Terminals are both among the largest wholesale suppliers of refined petroleum products in the northeast US. They supply a wide range of crude oil distillates such as petrol, kerosene, diesel, kerosene and home heating oil to retailers and commercial customers. Global has also ventured into the blending and supply of biofuels.
The terms of the deal set up a partnership whereby Warex will be able to use the terminals to service its existing business and to conduct future wholesale activities. The acquisition is scheduled to close in Q4 2009. Global Partners provisionally intends to finance it with debt.
The terminals will add to Global Partners network of refined products terminals, which is already one of the largest in the northeast US. The company already owns several terminals in the south of New York and the current acquisitions in Newburgh, 60 miles north of New York City, are intended to complement these.
Today's announcement marks a significant step in our continuing long-term growth strategy, said Eric Slifka, president and CEO of Global Partners. We expect this transaction to be accretive within the first 12 months of operation with improving returns over time as the business potential of these assets is further realised.
Global Partners today announces second-quarter profits of $978,000.