Parent Company of Hawaii Independent Energy Announces Acquisition of Mid Pac Petroleum | Business Wire
HONOLULU–(BUSINESS WIRE)–Par Petroleum Corporation (OTCQB:PARR), the parent company of Hawaii
Independent Energy, LLC, today announced that it has reached an
agreement to acquire Koko’oha Investments, Inc., the parent company of
Mid Pac Petroleum, LLC that is the exclusive licensee of the “76” brand
in the State of Hawaii, for approximately $107 million, subject to
adjustment as set forth in the merger agreement. Mid Pac operates or
distributes through more than 80 retail sites and four terminals across
“Acquiring Mid Pac will provide a unique expansion opportunity for our
Hawaii business. The access to additional retail sites will provide
synergies by increasing on-island sales of our refined products,
optimizing distribution costs and enhancing crude slate flexibility,”
said William Monteleone, chief executive officer of Par Petroleum. “In
addition, Mid Pac’s fee-owned real estate portfolio, consisting of
retail locations, terminals and office space, provides excellent
underlying asset value,” added Mr. Monteleone.
The added local gasoline and diesel sales for the Hawaii Independent
Energy refinery in Kapolei will spell benefits for Hawaii, noted Peter
Coxon, Par’s chief operating officer. “The increased local sales will
enable HIE to better optimize its operations and production slate,
providing Hawaii with stronger on-island refining capability,
high-quality manufacturing jobs, and a more secure energy supply,” Mr.
“I’m excited about what this means for Mid Pac and its employees,” said
Jim Yates, president and chief executive officer of Mid Pac Petroleum.
“The joining of HIE and Mid Pac creates a strong, vertically integrated
Hawaii-based refining and marketing company which provides stability for
our employees and dealers and strengthens an important energy source for
Mr. Yates is no stranger to refining in the Islands, having served as an
executive with a former owner of the Kapolei facility, BHP Hawaii. “This
is a homecoming of sorts for me, and I’m pleased that Par Petroleum does
not foresee making any staffing changes as they welcome Mid Pac
employees to their family of companies,” he said. “It’s also encouraging
to be a part of merging two companies with such deep local roots and
such long-standing commitments to investing in Hawaii and supporting
local non-profits. This transaction will ensure that those commitments
can continue,” Yates added.
Details of the transition are still to be worked out. Par Petroleum
anticipates finalizing the transaction sometime in the third quarter of
2014, subject to regulatory and other approvals. In September 2013, Par
Petroleum finalized the acquisition of Tesoro Hawaii, LLC, which
included the larger of the State’s two petroleum refineries, related
product storage and distribution assets, and 31 Tesoro-branded gasoline
stations on Oahu, Hawaii Island and Maui.
About Par Petroleum Corporation
Par Petroleum Corporation is a Houston-based company that manages and
maintains interests in a variety of energy-related assets. Par is a
growth company that looks for acquisitions with strong fundamentals and
employees who can move the business forward.
Par, through its subsidiaries, owns and operates a 94,000 bpd
refinery located in Hawaii on the island of Oahu. This refinery,
together with substantial storage capacity, a 27-mile pipeline system,
terminals, and retail outlets, provides a substantial portion of the
energy demands of Hawaii.
Par’s largest oil and gas asset is its investment in Piceance Energy,
LLC, which owns and operates natural gas reserves located in the
Piceance Basin of Colorado.
Par also markets, transports and distributes crude petroleum-based
energy products. With significant logistics capability on key pipeline
systems, a rail car fleet, and a fleet of chartered barge tows, Par
believes it has a competitive advantage in moving crude oil efficiently
from land locked locations in the Western U.S. and Canada to the
refining hubs in the Midwest, the Gulf Coast, and the East Coast.
About Mid Pac Petroleum
Mid Pac Petroleum is a Hawaii-based petroleum marketer and
distributor that has exclusive rights to the 76 brand for petroleum
sales in Hawaii. The company has 150 employees and distributes gasoline
and diesel through more than 80 retail locations throughout the state.
It also owns and operates petroleum product terminals and trucking
operations in Hawaii and is the first petroleum retailer on Oahu to
offer biodiesel to customers.
About Hawaii Independent Energy
Hawaii Independent Energy is the leading provider of transportation
fuels in the Islands. Altogether, there are more than 500 local
employees that make and distribute refined petroleum products such as
gasoline, diesel, marine fuel, and fuel oil to meet Hawaii’s energy
needs. Hawaii Independent Energy’s refinery in Kapolei is the larger of
the state’s two oil refineries. Hawaii Independent Energy supplies 31
Tesoro-branded retail stations on Oahu, Maui and the Big Island.
This press release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. All
statements other than statements of historical fact are forward-looking
statements. Forward-looking statements are subject to certain risks,
trends and uncertainties that could cause actual results to differ
materially from those projected. Among those risks, trends and
uncertainties are our ability to successfully complete the pending
acquisition of Mid Pac, integrate it into our operations and realize the
anticipated benefits from the acquisition; our ability to identify all
potential risks and liabilities in our due diligence of Mid Pac and its
business; any unexpected costs or delays in connection with the pending
acquisition of Mid Pac; risks associated with the integration of HIE;
the volatility of crude oil and refined product prices; uncertainties
inherent in estimating oil, natural gas and NGL reserves; environmental
risks; and risks of political or regulatory changes. Although the
company believes that in making such forward-looking statements its
expectations are based upon reasonable assumptions, such statements may
be influenced by factors that could cause actual outcomes and results to
be materially different from those projected. The company cannot assure
that the assumptions upon which these statements are based will prove to
have been correct. Important risk factors that may affect the
company’s business, results of operations and financial position are
discussed in its most recently filed Annual Report on Form 10-K, as
amended, recent Quarterly Reports on Form 10-Q, recent Current Reports
on Form 8-K and other SEC filings.