Gibson Energy in the sale of its propane operations to Superior Plus

  • Date Announced: February 13, 2017
  • Date Closed: April 03, 2017
  • Deal Value: $412,000,000
  • Client Name: Gibson Energy
Gibson Energy Inc. has entered into an agreement to sell its Industrial Propane Business for cash consideration of CAD 412m (USD 314.8m) to Superior Plus.

The sale will be completed through a series of transactions. Pursuant to an option purchase agreement, dated 13 February 2017, subject to the fulfilment of customary conditions, Gibsons and Superior are obligated to complete the initial transaction pursuant to which Superior pays non-refundable cash consideration of CAD 412m and Gibsons grants an irrevocable to Superior to acquire 100% of the partnership units and shares of the Canwest and Stittco businesses.

The cash payment of CAD 412m is expected to be received by Gibsons, concurrent with the granting of the Option, no later than 3 April 2017. Following granting of the Option by Gibsons, closing risk transfers to Superior. Upon exercise of the Option by Superior, and receipt of regulatory approvals, the Securities will be transferred to Superior for nominal consideration.

Gibsons will continue to operate the business under the direction of the current management team, with no disruption to its employee base and customer service levels, until the final closing of the divestiture, which is expected to occur no later than the fourth quarter of 2017.

As part of the sale, Superior has agreed to 5-year wholesale supply and truck transportation agreements that offer Gibsons an ability to continue procuring propane volumes for Canwest and Stittco and provide bulk delivery rights to the associated branch distribution locations.