Watco Companies, LLC has reached a definitive agreement with Kinder Morgan Terminals (KMT) to purchase 20 bulk terminal operations in the United States. The acquisition will expand Watco’s terminal operations to 73 locations.
“The Watco Team is excited to continue expanding our waterways presence,” said Will Patterson, Watco’s senior vice president of network strategy. “We realized tremendous success through the terminals that were acquired in our previous transaction with Kinder Morgan in early 2015 and we expect continued success with these facilities as well.”
“We have identified many opportunities to expand our terminal operations and rail presence with these new sites and look forward to further developing operations with our customers,” added Patterson.
John Schlosser, Kinder Morgan Terminals president, stated, “We are delighted to enter into this mutually beneficial transaction with Watco. It allows us to monetize non-core assets, representing less than 2 percent of the segment’s earnings, on attractive terms while giving employees at those terminals an opportunity to work on assets that are core to Watco’s business.”
Included in the purchase are 14 locations on the inland waterways, 4 rail/truck terminals, and 2 deep water locations. The locations are focused on the dry and break bulk industries and handle a diverse mix of commodities including fertilizer, ferro alloys, salt, coal, and various break-bulk products.
“This group of terminals provides yet another great opportunity to grow with our Customers,” remarked Dan Smith, Watco chief operating officer. “We have continued to evolve and refocus our operations and marketing efforts. We are extremely appreciative of the opportunity to provide a high level of safe and efficient service to Customers at these locations and will work to expand business in these new markets with this abundant new base of assets.”
In anticipation of the terminal acquisition, a new equity investment was closed on September 30, 2016, with SkyKnight Capital, whose seed investors are the Crowley Family, who own and operate Crowley Maritime. Watco expects that Crowley Maritime will be a long-term strategic partner. Tom Crowley has joined Watco’s Board of Directors as part of SkyKnight’s initial investment into Watco. Watco and SkyKnight anticipate closing a second round of equity with additional equity partners prior to year-end to support Watco’s various customer growth initiatives.