Calgary-based Parkland Fuel Corp. announced on Friday it’s acquiring all of the issued and outstanding equity interests of U.S.-based Tropic Oil Co. Inc., as well as equity interests and the assets of certain of its affiliates.
Tropic Oil is headquartered in Miami, Fla., and transports, distributes and markets a full range of fuels and lubricants across the central and south Florida region. It supplies and operates nine cardlock facilities and four bulk storage plants and warehouses.
Parkland said the acquisition will be funded out of cash flow from operations and existing credit facility capacity. The acquisition was completed at valuation metrics consistent with prior transactions in the U.S., and pro forma the acquisition, Parkland expects annual run-rate adjusted earnings before interest, tax, depreciation and amortization (EBITDA) of approximately C$60 million for its U.S. segment. The transaction is expected to close on Oct. 1 and is subject to closing conditions customary for transactions of this nature, said Parkland.
No financial details were released.
Bob Espey
Parkland president and CEO
“The Tropic Oil acquisition continues on our U.S. growth strategy by adding quality regional operators in regions where we can bring a distinct supply advantage,” said Bob Espey, president and CEO of Parkland, in a news release. “This initial toehold in Florida also complements our Caribbean business by providing significant supply and distribution synergy potential. We welcome Steve Gorey from Tropic Oil’s leadership team and the rest of their employees into Parkland.”
Parkland is an independent supplier and marketer of fuel and petroleum products and a leading convenience store operator. Parkland services customers across Canada, the United States, the Caribbean region and the Americas through three channels: retail, commercial and wholesale. Parkland optimizes its fuel supply across these three channels by operating and leveraging a growing portfolio of supply relationships and storage infrastructure.
“Through Tropic Oil, Parkland is adding its third regional operating centre (ROC) and expanding its presence into the southeastern states for the first time. Tropic Oil is Florida’s preferred supplier of marine diesel and lubricants, and is highly regarded for its ability to provide consistent, reliable service throughout the central and south Florida markets,” said Doug Haugh, president of Parkland U.S.A. “This new southeast ROC will be the operating platform that drives organic growth and enables further acquisitions across the region, while leveraging our business with Sol.”
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