One of the country’s major propane retailers has just completed a $30.5 million-plus acquisition to extend its reach into the western states, thestreet.com reports.
In a statement this week, NGL Energy Partners LP announced it had acquired the assets of Pacer Propane (“Pacer”) in exchange for $30.5 million in cash plus net working capital and 1.5 million NGL common units. The deal is expected to add about 17 million gallons of annual sales volume to NGL’s already sizable national operations, earning the Delaware-based propane heavyweight between $7 million and $8 million more each year.
Pacer Propane was founded in 1991 by Frank Mapel and other partners. It has grown over the years to include retail propane operations in the states of Washington, Oregon, Utah, Colorado, Illinois and Mississippi.
“Pacer Propane expands our geographic footprint into the western states,” NGL Retail Division Co-President and Chief Operating Officer Shawn Coady said. “Since NGL Energy Partners’ May 2011 initial public offering, we have extended our retail propane operations to both coasts and significantly expanded our midstream business by adding 12 natural gas liquids terminals through our recently completed SemStream transaction.”
Mapel, Pacer’s founder, said the deal meant his company could continue its legacy of serving the energy needs of its loyal customer base across several US states.
“I am excited by the opportunities this transaction presents for our employees and will remain active working with NGL management.”
NGL has been building in strength in recent months. In October the company entered into a new partnership with E. Osterman Propane, Inc. in a deal that expanded NGL’s reach into the Northeast propane market. Osterman operated 20 customer service and satellite distribution locations, with above-ground storage capacity of around 1.7 million gallons. It had sold more than 40 million gallons of propane to 80,000 customers in the previous year throughout Maine, Massachusetts, New Hampshire, Connecticut, Vermont, Rhode Island and New York.
NGL Energy now serves 124,000 customers in 11 states with an estimated 5.7 million gallons of storage capacity.