Private Equity Group Ready to Take Over Pennsylvania Terminal Empire
The PPC property have been on the market since mid-2014 and Marathon was thought to have the inside the price of wti crude oil track on the sale. As an alternative, OPIS hears that ArcLight Capital Companions will purchase the properties. ArcLight Capital is a Boston-primarily based private fairness agency that has invested over $12 billion in 88 transactions since it was based in 2001. The company targets midstream, energy and production opportunities in power.
ArcLight is not to the price of wti crude oil be confused with New York-based Arc Logistics LP, a public company that operates crude and merchandise terminals in numerous Great Lakes and the price of wti crude oil southeast states as well as in the new York Harbor and in Louisiana and Mississippi. The 2 firms don’t have any affiliation.
While not a family title for marketers, ArcLight Capital is well-known in energy investment circles. The corporate at one point held a stake in the overall Accomplice share of Buckeye, and has helped launch public MLP’s in natural gasoline, crude oil, shale, and asphalt with an emphasis on logistics.
Parties familiar with the PPC terminal package counsel that the services are essentially the most effectively-managed and well-maintained properties in the country. Privately held PPC has essentially no debt and operated one of many most efficient merchandise methods within the country. That effectivity may need been detrimental to some potential patrons who struggled with a marketing strategy that might discover upside or growth for the terminals. Because the transaction will contain two private corporations, the purchase value is not likely to be disclosed but most sources peg the value above $1 billion. Investment house Credit score Suisse has dealt with the sale.
PPC properties for sale included approximately a dozen terminals — all in Pennsylvania — with about four million barrels of storage in amenities that vary in size from 150,000 barrels to over 500,000 barrels. Reports indicated annual EBITDA of approximately $a hundred million in 2014.
The terminals are located in in Allentown, Altoona, Coraopolis, Dupont, Pittsburgh, Neville Island, Harrisburg, Northumberland, Sinking Springs, Mechanicsburg, Highspire and Lancaster. A terminal owned by PPC in Williamsport is within the technique of being closed, OPIS is instructed, so it isn’t a part of the package deal. Along with working a proprietary terminal in Coraopolis, PPC leases an extra terminal there from Buckeye Pipeline. A lubes firm owned by PPC is reportedly not a part of the sale.
The two largest PPC facilities are in Harrisburg and Coraopolis with every boasting in excess of 500,000 barrels of capability. Sources inform OPIS that PPC has its own unit practice operation that brings ethanol directly from Chicago and the Midwest into its western Pennsylvania areas. It may take barge deliveries from Midwestern refineries to a big facility near Pittsburgh.
It is not identified whether Marathon Petroleum backed away from a deal, or was merely outbid by ArcLight Capital. There’s speculation that Marathon could be more intrigued by a possible acquisition of Gulf Oil, which has been shopped by investment house EverCore Partners since October. A purchase order of Gulf’s terminal community and wholesale and vendor enterprise would assist Marathon achieve its strategy of moving extra of its refining manufacturing by entities it controls.