Sprague Resources, Portsmouth, N.H., announced that its operating subsidiary, Sprague Operating Resources, has signed an agreement to purchase the membership interests of Coen Energy, and Coen Transport, as well as four bulk plants and underlying real estate.
Coen Energy, Washington, Pa., provides energy products and complimentary energy field services to over 7,000 customers in Pennsylvania, Ohio and West Virginia. The energy field services segment provides fuel sales, delivery, management and related services supporting the Marcellus and the Utica shale drilling activity. The Coen Energy business is supported by four in-land bulk plants, two throughput locations, approximately 100 delivery vehicles and nearly 250 employees. The transaction is expected to contribute an additional $7 million to $8 million of adjusted EBITDA on an annual basis, and is also expected to be immediately accretive to unitholders.
“I’m thrilled to announce Sprague’s fifth acquisition of 2017. Coen Energy expands both our geographic footprint and business model to include additional commercial fueling activities,” David Glendon, president and CEO of Sprague, said in a statement. “Coen’s strong reputation for customer service and safe operations has generated strong customer loyalty and provides an outstanding platform for continued growth in the region,” Glendon said.
“We are proud of our team and the business that we have built together at Coen Energy to become a leader in our line of work. Legacy is very important to the Coen Family. Coen Energy already has an exciting future ahead of it on many levels. Its future is made even more exciting with enhanced capabilities and effectiveness to serve our customers as part of the Sprague Family,” added Andy McIlvaine, president of Coen Energy.
Sprague intends to fund the transaction with borrowings from its senior secured credit facility; closing is expected to occur in the fourth quarter.
Sprague has updated its investor relations website with slides containing additional information regarding the pending acquisition. The presentation can be accessed from Sprague’s website at http://www.spragueenergy.com/investor-relations. Height Securities served as financial advisor to Sprague on the transaction.
Sprague Resources LP is engaged in the purchase, storage, distribution and sale of refined petroleum products and natural gas. The company also provides storage and handling services for a broad range of materials. More information concerning Sprague can be found at www.spragueenergy.com.
Founded in 1923, Coen Oil Company, LLC is the parent company of Coen Energy, Coen Transport as well as Coen Markets, a convenience store chain operating in Pennsylvania, Ohio and West Virginia, and Coen Tire, a tire retailer operating in the same tri-state region. More information can be found at coenoil.com.