TransMontaigne Partners L.P. Announces Agreement to Acquire Two West Coast Refined Product and Crude Oil Terminals from Plains All American Pipeline, L.P.
TransMontaigne Partners L.P. (NYSE:TLP, the “Partnership”) announced
today that one of its wholly owned subsidiaries has entered into an
agreement to acquire the Martinez Terminal and Richmond Terminal
(collectively, the “West Coast Facilities”) from an affiliate of Plains
All American Pipeline, L.P., for a total purchase price of $275 million.
The acquisition expands the Partnership’s storage and terminaling
footprint into the San Francisco Bay Area refining complex. The
acquisition is expected to be financed through the proceeds of a common
unit offering and cash available from other sources. The closing of the
acquisition is expected to occur on or about January 1, 2018, subject to
customary closing conditions.
“We believe that this transaction strengthens our position as one of the
leading refined products terminaling and transportation service
providers in the country,” said Fred Boutin, Chief Executive Officer of
TransMontaigne Partners. “The West Coast Facilities are strategically
located within the San Francisco Bay Area refining complex, one of the
largest refining complexes in North America. These terminals and their
fee-based cash flows are well-aligned with our existing business model,
and are backed by agreements with customers that include many of the
largest, most-recognizable refining, refining logistics and merchant
trading companies in the world. This acquisition, combined with the
organic growth we have executed this year, supports and extends our
commitment to deliver stable and growing distributions over the
long-term.”
The West Coast Facilities include two waterborne refined product and
crude oil terminals with a total of 64 storage tanks with approximately
5.4 million barrels of storage capacity. The facilities have extensive
connectivity to domestic and international refined product and crude oil
markets through significant marine, pipeline, truck and rail
capabilities. The facilities are supported by multi-year, fee-based
agreements with contract terms of up to 5 years. The purchase price
reflects a less than ten times multiple of the Partnership’s estimate of
the 2018 EBITDA attributable to the West Coast Facilities based on
current customer contracts and historical and anticipated activity
levels, revenues and operating costs. The Partnership cautions that it
cannot provide any assurance that the West Coast Facilities will achieve
this anticipated level of EBITDA.
Advisors
BofA Merrill Lynch served as TransMontaigne Partners’ exclusive
financial advisor on the transaction.
About TransMontaigne Partners L.P.
TransMontaigne Partners L.P. is a terminaling and transportation company
based in Denver, Colorado with operations in the United States along the
Gulf Coast, in the Midwest, in Houston and Brownsville, Texas, along the
Mississippi and Ohio Rivers, and in the Southeast. We provide integrated
terminaling, storage, transportation and related services for customers
engaged in the distribution and marketing of light refined petroleum
products, heavy refined petroleum products, crude oil, chemicals,
fertilizers and other liquid products. Light refined products include
gasolines, diesel fuels, heating oil and jet fuels; heavy refined
products include residual fuel oils and asphalt. We do not purchase or
market products that we handle or transport. News and additional
information about TransMontaigne Partners L.P. is available on our
website: www.transmontaignepartners.com.
No Offer or Solicitation
This communication is for informational purposes only and shall not
constitute an offer to sell or the solicitation of an offer to buy any
securities pursuant to the proposed transactions or otherwise, nor shall
there be any sale of securities in any jurisdiction in which the offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such jurisdiction.
Forward-Looking Statements
This press release includes statements that may constitute
forward-looking statements for federal securities laws. Although the
Partnership believes that the expectations related to the West Coast
Facilities reflected in such forward-looking statements are based on
reasonable assumptions, actual results could differ materially from
those projected in the forward-looking statements as a result of certain
risk factors, including, (i) the successful integration and performance
of the acquired assets, (ii) the ability to obtain required permits and
other approvals on a timely basis; (iii) adverse changes in general
economic or market conditions, and (iv) competitive factors such as
pricing pressures and the entry of new competitors. Additional important
factors that could cause actual results to differ materially from the
Partnership’s expectations and may adversely affect its business and
results of operations are disclosed in “Item 1A. Risk Factors” in the
Partnership’s Annual Report on Form 10-K for the year ended December 31,
2016, filed with the Securities and Exchange Commission on March 14,
2017. The forward-looking statements speak only as of the date made,
and, other than as may be required by securities law, the Partnership
undertakes no obligation to update or revise any forward looking
statements, whether as a result of new information, future events or
otherwise.
Non-GAAP Financial Measure
EBITDA
EBITDA is not a computation based upon generally accepted accounting
principles and is not necessarily comparable to similarly titled
measures of other companies. As used above, EBITDA means earnings before
interest, taxes, depreciation and amortization. EBITDA is presented here
because it is a widely accepted financial indicator and used to compare
performance of the acquired assets. The Partnership believes that EBITDA
provides investors an enhanced perspective of the expected operating
performance of the West Coast Facilities. It is not practical to provide
a reconciliation of forecasted EBITDA for the year 2018 to the most
directly comparable GAAP measure, net earnings, because certain items
cannot be reasonably estimated or predicted at this time. Any of those
items could be significant to the West Coast Facilities’ financial
results.
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