Pipeline transportation of natural gas company American Midstream Partners (AMID) has entered into a definitive agreement for the sale of its refined products terminalling business (Refined Products Terminals) to Sunoco, for approximately $125m.
The transaction is expected to close in the fourth quarter of 2018, a release said.
The divestiture of the Refined Products Terminals, located in Caddo Mills, Texas and North Little Rock, Arkansas, represents continued progress towards American Midstream’s capital allocation strategy designed to reduce leverage and strengthen the partnership.
“In addition, the divestiture of the Refined Products Terminals simplifies AMID’s business profile while creating capital flexibility,” the company said in a statement.
The refined products terminalling business consists of terminals located in Caddo Mills, Texas and North Little Rock, Arkansas with a combined 21 tanks, approximately 1.3 million barrels of storage capacity and approximately 77,500 barrels per day of total throughput capacity.
The acquisition builds on Sunoco's strategy of adding fee-based refined product terminals into the overall portfolio.
The acquisition is subject to customary closing conditions including clearance under the Hart-Scott-Rodino Act and is expected to close in the fourth quarter of 2018. The transaction is expected to be accretive to Sunoco with respect to distributable cash flow in the first year.
