Ferrellgas Partners LP announced June 1 that it has entered into a definitive purchase and sale agreement to acquire Dallas TX-based Bridger Logistics LLC, a provider of integrated crude oil midstream services, for a purchase price of approximately $837.5 million, subject to certain closing adjustments.
In conjunction with this transaction, Ferrellgas also announced that its Board of Directors has approved a $0.0125 increase in its quarterly distribution rate to $0.5125 per FGP common unit ($2.05 on an annualized basis), effective following the closing of the transaction.
“We are extremely pleased to welcome Bridger into the Ferrellgas family,” said Stephen L Wambold, chief executive officer and president of Ferrellgas. “It is a remarkable organization with a proven record of developing robust midstream assets and executing long-term growth initiatives. We’ll benefit greatly from their collective experience and deep customer relationships as we continue to pursue midstream-focused growth opportunities.”
Founded in 2010, Bridger owns and operates assets across the midstream value chain and can provide end-to-end crude oil logistics, including trucking, terminaling, pipeline, rail, and maritime, from the wellhead to end markets across North America. The company has operations in 14 states and virtually all major US crude oil production regions, including the Permian, Bakken, Rockies, Niobrara, Mid-Continent, Gulf Coast, and Eagle Ford.
The move positions Ferrellgas to significantly expand its midstream platform and is expected to be immediately accretive to Ferrellgas and supportive of future distribution growth. The company, which is the nation’s second largest propane retailer and the nation’s largest provider of propane by portable tank exchange, established a midstream division in May 2014, when it acquired Sable Environmental LLC.
Bridger, which was named Inc Magazine’s “Fastest Growing Energy Company” in 2013, will continue to operate as an independent entity inside of Ferrellgas. Julio Rios, president and chief executive officer of Bridger, will continue to oversee its operations and will report directly to Wambold
With the addition of Bridger, Ferrellgas now offers a comprehensive portfolio of crude-focused midstream assets, diversifying its existing asset base and creating a platform from which to execute its long-term midstream growth initiatives.
“This is a landmark transaction for Ferrellgas and represents a key milestone in our diversification efforts,” said Todd Soiefer, Ferrellgas’ senior vice-president of strategic development. “Bridger’s established and growing footprint of crude logistics assets allows us to strategically diversify our existing business and add significant scale to our growing midstream platform.”