Shell Midstream Partners, L.P. Announces Agreement to Acquire Additional Interests in Explorer and Colonial Pipelines
“This acquisition is evidence of our strategy in action – we will continue to build scale with diversified assets that provide robust, ratable cash flows,” said
The acquisition is expected to be immediately accretive to unitholders and anticipated to be funded with 75% debt through a credit facility with our Sponsor and 25% equity placement to
Key value drivers for the transaction include:
- Strategic access to growing advantaged refined products supply from the
- Increased position in midstream assets delivering ratable and growing cash flows; and
- The transaction value, including proportional non-consolidated debt at Explorer and Colonial, reflect an approximate 7.0 times multiple of the contributed interest’s forecasted next twelve months adjusted earnings before interest, taxes, depreciation and amortization.
The acquisition is expected to close in the second quarter of 2019, and is subject to the Hart-Scott-Rodino Antitrust Improvements Act approval and other customary closing conditions.
Explorer is recognized as one of the nation's leading petroleum products transporters serving more than 70 major cities in 16 states. Its 1,830-mile pipeline transports gasoline, diesel, fuel oil and jet fuel with a capacity of 660,000 barrels per day. Explorer continues to diversify its portfolio of services for its shippers.
Colonial is the largest refined products pipeline in
The terms of the acquisition were approved by the conflicts committee of the Board of Directors of the General Partner of
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FORWARD LOOKING STATEMENTS
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Source: Shell Midstream Partners, L.P.