NGL To Sell Retail Propane Business To Superior Plus for $900M

Reuters (May 30, 2018) — Canadian specialty chemicals firm Superior Plus Corp said on Wednesday it would buy NGL Energy Partners’ retail propane unit for $900 million in cash to boost its presence in the United States.

NGL’s shares surged 14 percent to 12.20 in trading after the bell.

NGL Propane sells propane and distillates to over 316,000 residential, commercial and industrial customers in the U.S. Northeast, Southeast and Upper Midwest under regional brands, including Osterman Propane, Downeast Energy and Eastern Propane.

In the 12 months to March 31, NGL Propane sold about 182 million gallons of fuel, generating about $85 million in adjusted earnings before interest, taxes, depreciation, and amortization.

Superior said the deal would help save about $20 million to $25 million within the first two years of its closure, which is expected in the third quarter, and immediately add to its adjusted cash flow. The Toronto-based company said it planned to raise C$400 million ($310.68 million) by issuing 32 million subscription receipts at a price of $12.50 per piece to finance a portion of the acquisition.

TD Securities Inc and CIBC Capital Markets are leading a syndicate of underwriters for the offering, Superior said, adding the rest of the purchase price will be funded through a $400 million bridge facility.

$1 = 1.2875 Canadian dollars Reporting by Taenaz Shakir in Bengaluru; Editing by Anil D’Silva

Executive Management & Divisional Leadership:

Luc Desjardins

President and Chief Executive Officer

Mr. Desjardins joined Superior Plus as President and Chief Executive Officer in 2011. Prior to joining Superior Plus, Mr. Desjardins was a partner of the Sterling Group LLP, a private equity firm. Mr. Desjardins also served as President and Chief Executive Officer at Transcontinental Inc. from 2004 to 2008 and Chief Operating Officer from 2000 to 2004. Mr. Desjardins holds a Masters of Business Administration degree from the University of Quebec and has taken the Harvard Business School Management Development Program.

Andy Peyton

President, U.S. Propane Distribution

Mr. Peyton joined Superior in 2016 as President of US Propane Distribution. He has held various executive positions within the energy sector, most recently with AmeriGas Partners LP. Andy holds a Bachelor of Science (BSc) degree from Pennsylvania State University and a MBA from the University of Chicago Booth School of Business.