Buckeye Partners LP, which operates pipelines and other transportation and storage assets for liquid petroleum products, said it bought a 50 percent stake in the marine terminal company VTTI BV for $1.15 billion.
VTTI is a unit of Vitol Group. The deal is expected to close in early January 2017. VTTI will be 50% indirectly owned by Buckeye and 50% indirectly owned by Vitol.
It is intended that the joint shareholding of Buckeye and Vitol will add greater strategic value to VTTI and will further strengthen VTTI's position as a leading independent provider of energy storage solutions.
Buckeye is a publicly traded master limited partnership and owns and operates a diversified network of integrated assets providing midstream logistic solutions, primarily consisting of the transportation, storage, and marketing of liquid petroleum products.
It is one of the largest independent liquid petroleum products pipeline operators in the United States in terms of volumes delivered, with approximately 6,000 miles of pipeline and a terminal network comprising more than 120 liquid petroleum products terminals with aggregate storage capacity of over 110 million barrels.
Through this transaction, Buckeye will access VTTI's significant international footprint. VTTI is one of the largest independent global energy terminal businesses that, through its subsidiaries and partnership interests, owns and operates approximately 54 million barrels of petroleum product and crude oil storage capacity across 13 terminals located on five continents. VTTI Energy Partners LP began trading on the New York Stock Exchange as a master limited partnership on 1 August 2014.
Chris Bake, Chairman of VTTI said, "We look forward to partnering with Buckeye for the next phase of VTTI's future. Buckeye brings in a wealth of terminalling experience and knowledge which will further strengthen the strategic position of VTTI as we continue to invest in its growth."
Upon completion, Buckeye and Vitol will have equal Board representation and voting rights in VTTI. VTTI will continue to be run as an independent, standalone company under the leadership of CEO Rob Nijst.
Rob Nijst, CEO of VTTI said: "We are looking forward to our cooperation with Buckeye, and we believe that their industry expertise and experience will offer great value to VTTI. Through this transaction, VTTI will have two strong shareholders that will support VTTI's continued growth as an independent global terminal operator."
The transaction is subject to regulatory approvals and customary closing conditions and is expected to close in early January 2017.
