Genesis Energy, L.P. (NYSE: GEL) announced today that it has agreed to acquire for approximately $230 million all the assets of the downstream transportation business of Hornbeck Offshore Transportation, LLC (“Hornbeck”). The business is primarily comprised of nine barges and nine tug boats which transport crude oil and refined petroleum products, principally serving refineries and storage terminals along the Gulf Coast, Eastern Seaboard, Great Lakes and Caribbean. At the closing of the transaction, Hornbeck and Genesis expect to enter into transition service agreements to facilitate a smooth transition of operations and uninterrupted services for both employees and customers.
This acquisition complements and further integrates our existing operations, including our Genesis Marine inland barge business (comprised of 50 barges and 23 push/tow boats), our crude oil and heavy refined products storage and blending terminals as well as our crude oil pipeline systems. The acquired barges, which have an average age of approximately eight years, are double-hulled and fully compliant with the requirements of the Oil Pollution Act. Eight of the nine barges are equipped with vapor recovery. The tug boats, eight of which have been rebuilt and put into service since 2005, are modern and efficient.
“We are very pleased to have the opportunity to expand our marine transportation capabilities through the acquisition of these ocean going vessels which complement our inland waterway operations as well as our other crude oil and heavy refined product assets,” said Grant Sims, Chief Executive Officer of Genesis. “There is a significant overlap in existing customers, and we look forward to working with Hornbeck to facilitate a seamless transition for our collective customers and employees.”
The acquisition is subject to usual and customary closing conditions, including regulatory approvals and consents, and would be expected to close by the end of the third quarter of 2013. Genesis has available and committed liquidity under its $1 billion revolving credit facility to effect this acquisition in addition to funding all of its organic growth capital requirements. The acquisition is expected to be immediately accretive to Genesis’ distributable cash flow per unit.
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