Transactions - JUNE 8, 2017

SemGroup acquires Houston Fuel Oil Terminal Co. for $2.1b

by Released

SemGroup Corp. has entered into a definitive agreement with investment funds managed by Alinda Capital Partners to acquire Houston Fuel Oil Terminal Co. (HFOTCO) for $2.1 billion, including assumption of debt.

HFOTCO is a 16.8 million-barrel terminal strategically located on the U.S. Gulf Coast with pipeline connectivity to the local refining complex, deepwater marine access and inbound pipeline, and rail and truck receipt capabilities from all major producing basins. The company’s assets are located on 330 acres of the Houston Ship Channel, one of the most active trading centers for residual fuel oil and crude oil in the world.

“We believe that adding this asset to SemGroup’s portfolio is a great way to leverage customer relationships, strengthen both businesses and create additional shareholder value,” said Chris Beale, managing partner of Alinda Capital Partners.

“Consistent with our strategy to diversify our portfolio and become more downstream logistics focused, HFOTCO brings a well-established base of high-quality, long-tenured customers to our business,” said Carlin Conner, president and CEO at SemGroup.

The terminal’s location on the Houston Ship Channel provides deepwater access and is positioned to capture increasing export volumes, added Conner.

The acquisition is expected to close in third quarter 2017, subject to the receipt of certain governmental approvals and the satisfaction of other customary closing conditions.

SemGroup intends to maintain HFOTCO’s workforce and anticipates that all of the company’s approximately 125 employees will become members of the SemGroup team upon the transaction’s close.

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