Valero Energy Partners Buys Terminal Services for $325 Millionby
Valero Energy Partners LP said it acquired terminals at refineries in Louisiana and Texas from a subsidiary of Valero Energy Corp. for $325 million.
The acquisition is expected to add about $25 million of net income and about $39 million of earnings before interest, taxes, depreciation and amortization in the first twelve months of operation, the San Antonio-based company said in a statement Monday. The partnership expects to finance the acquisition with borrowings under its revolving credit facility, cash on hand and issuance of common and general partner units to Valero subsidiaries.
The drop-down follows a $671 million transaction earlier this year for the Houston and St. Charles, Louisiana, terminals. The company said it will enter into 10-year terminaling agreements with a subsidiary of Valero that will include minimum-volume commitments. The Meraux, Louisiana, assets have 3.9 million barrels of storage capacity for crude oil, intermediates, and refined petroleum products while the Three Rivers, Texas, terminal has 2.25 million barrels of capacity, according to the statement.
The deal is expected to close on September 1.