New Hampshire firm acquires two Coen Oil divisions
October 20, 2017
Pittsburgh Business Times
Sprague Resources LP has acquired Coen Energy and Coen Transport, bringing the publicly-traded company based in New Hampshire into southwestern Pennsylvania.
Financial terms of the deal between Sprague (NYSE: SRLP) and privately held Coen Oil. Co. of Washington, Pa., included a $33.75 million base purchase price, the value of its petroleum products and a potential earnout of up to $12 million, according to a U.S. Securities and Exchange filing made by Sprague. The rest of Coen Oil, which also includes convenience stores and a tire company, were not involved in the transaction and remain on their own.
Coen Energy provides fuel to about 7,000 residential and commercial customers in the tri-state region, as well as field services to the Marcellus and Utica shale industries in Pennsylvania, Ohio and West Virginia. Coen Transport ships fuel.
The deal closed in early October. It included four bulk plants, two other locations, 100 trucks and 250 employees.
In an interview with the Pittsburgh Business Times on Friday, Coen Oil CEO Charles McIlvaine credited the team members and the strategy of being best-in-class and a leader in the region for home heating, commercial fuel and energy field services serving the Marcellus and Utica shale industries.
"Our team and our brand have become well-known and well-appreciated for the highest quality of service and effectiveness of what we do," McIlvaine said. "... We felt on a strategic basis that our good company, our good name, our good employees, our good market position, could solidify its future legacy with a bigger, better and stronger partner in someone like Sprague."
He said the company didn't take the sale lightly.
"For the benefit of the team who was there, of whom we are proud, and for the future opportunity that this platform can create, in our region and out of our region, we made a long-term decision ... of ensuring Coen Energy will maintain its leadership going forward," McIlvaine said.
Kory Arthur, a spokesman for Sprague, said that Coen Energy and Coen Transport had a successful track record and on a good track for growth. Arthur said that a Sprague executive is relocating to southwestern Pennsylvania to manage the day-to-day operations.
There were at least three real-estate transactions involved in the deal, according to Washington and Westmoreland County records obtained by the Pittsburgh Business Times. That included $1.3 million for property on West Chestnut Street in Washington, Pa., and $617,526 for the Coen Energy headquarters at 1045 West Chestnut St. Sprague also paid $708,517 for property at 731 S. Main St., Southwest Greensburg Borough in Westmoreland County.