Superior Plus Expanding Propane Footprint in the Northeast

Superior Plus Corp. (Toronto) has announced that one of its wholly-owned subsidiaries has entered into an agreement to acquire the assets of Rymes Propane and Oil, a retail propane and heating oil distribution company based in New Hampshire. The aggregate purchase price is approximately $159 million (U.S.), before adjustments for working capital. Superior anticipates drawing on its credit facility to fund the amount of the purchase price due on closing.

The agreement, which is subject to customary regulatory and commercial closing conditions, is anticipated to close by September 30, 2020.

This acquisition aligns with Superior’s core strategy of investing in established businesses that are in desirable geographies and generate stable free cash flow. In addition, it expands Superior’s U.S. propane distribution footprint and scale in New Hampshire and New England, and leverages Superior’s existing expertise, integrated platform, and operational effectiveness into a new customer base.

Founded in 1969 by James T. Rymes, Sr. and Carol Rymes, Rymes is an established independent family owned and operated retail propane and heating oil distributor servicing approximately 88,000 residential and commercial customers primarily in New Hampshire, Maine, Massachusetts and Vermont. Rymes has 46 operating locations, approximately 3 million gallons of storage capacity, a fleet of 350 vehicles and approximately 370 employees.

New Hampshire is an attractive propane distribution market for Superior to expand its footprint. Based on management estimates and independent third-party research, the New Hampshire retail propane distribution market has approximately 185 million gallons of demand and an opportunity for further industry consolidation as the market is highly fragmented with more than 50 independent propane retailers operating in the state.

“We are very pleased to enter into this transaction which expands our U.S. propane distribution business in the Northeast U.S.,” said Luc Desjardins, Superior’s president and CEO. “Rymes is a solid business and we look forward to welcoming the team to Superior and continuing to provide outstanding customer service to their customers.”

SOURCE: The Weekly Propane Newsletter, August 27, 2020. Weekly Propane Newsletter subscribers receive all the latest posted and spot prices from major terminals and refineries around the U.S. delivered to inboxes every week. Receive a center spread of posted prices with hundreds of postings updated each week, along with market analysis, insightful commentary, and much more not found elsewhere.