Watco to purchase 20 additional bulk terminals from Kinder Morgan

Watco

Watco Companies, LLC (Watco), and Kinder Morgan Terminals (KMT) have established a definitive agreement for Watco to purchase 20 U.S. bulk terminal operations.  

The move will expand Watco’s terminal operations to include 73 locations. The new locations include 14 locations on the inland waterways, four rail/truck terminals and two deep water locations. The locations are focused on the dry and break bulk industries handling a variety of commodities including fertilizer, ferro alloys, salt, coal and various break-bulk products.

“The Watco team is excited to continue expanding our waterways presence. We realized tremendous success through the terminals that were acquired in our previous transaction with Kinder Morgan in early 2015 and we expect continued success with these facilities as well,” said Will Patterson, Watco’s senior vice president of network strategy. “We have identified many opportunities to expand our terminal operations and rail presence with these new sites and look forward to further developing operations with our customers.”

Watco Chief Operating Officer Dan Smith says he expects the added group of terminals to provide an opportunity to grow with the company’s customers.

“This group of terminals provides yet another great opportunity to grow with our Customers,” Smith said. “We have continued to evolve and refocus our operations and marketing efforts. We are extremely appreciative of the opportunity to provide a high level of safe and efficient service to Customers at these locations and will work to expand business in these new markets with this abundant new base of assets.”

In anticipation of the terminal acquisition, the company closed a new equity investment Sept. 30, 2016, with SkyKnight Capital (SkyKnight). The Crowley Family, who owns and operates Crowley Maritime, are the seed investors behind SkyKnight.

Watco representatives say Crowley Maritime, one of the largest maritime businesses in the U.S., is expected to be a long-term strategic partner. Along with SkyKnight’s initial investment in Watco, Tom Crowley has also joined Watco’s board of directors. Watco and SkyKnight plan to close a second round of equity with additional equity partners before the year ends to support Watco’s various customer growth efforts.

“We are delighted to enter into this mutually beneficial transaction with Watco,” said John Schlosser, Kinder Morgan Terminals president. “It allows us to monetize non-core assets, representing less than 2 percent of the segment’s earnings, on attractive terms while giving employees at those terminals an opportunity to work on assets that are core to Watco’s business.”

The transaction with Kinder Morgan includes the following terminal locations:

• Amory Bulk Terminal, Amory, Miss.
• Black Hawk Terminal, Waterloo, Iowa
• Blytheville Terminal, Blytheville, Ark.
• Camden Terminal, Camden, N.J.
• Chicago Ferro, Chicago, Ill.
• Cincinnati Bulk/Liquids (River T), Cincinnati, Ohio
• Columbus Terminal, Columbus, Miss.
• Cora Terminal, Rockwood, Ill.
• Decatur Ferro Terminal, Trinity, Ala.
• Decatur River Port, Trinity, Ala.
• Gateway Warehouse, St. Louis, Mo.
• Grand Rivers, Grand Rivers, Ky.
• Guntersville Bulk Terminal, Guntersville, Ala.
• Kinder Morgan Cahokia Terminal, Sauget, Ill.
• Meramec Services, Sauget, Ill.
• Owensboro Gateway Terminal – East, Hawesville, Ky.
• Port Newark Terminal, Port Newark, N.J.
• Port of Memphis Bulk Terminal, Memphis, Tenn.
• West Memphis Reload, West Memphis, Ark.
• West Memphis Terminal, Memphis, Ark.

Wells Fargo Securities, LLC, served as the exclusive financial advisor to Kinder Morgan regarding the transaction.