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Kirby Corp. to purchase Stewart & Stevenson

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Hydrocarbon Engineering,


Kirby Corporation (Kirby) has announced the signing of a definitive agreement to acquire substantially all of the assets and businesses of Stewart & Stevenson LLC (Stewart & Stevenson), a subsidiary of the Houston-based Parman Capital Group, for approximately US$710 million before post-closing adjustments and transaction fees. The agreement was signed on 13 June by Hushang Ansary, Executive Chairman of Stewart & Stevenson, and Joseph H. Pyne, Executive Chairman of Kirby Corp.

The purchase will be funded equally through Kirby's revolving credit facility and Kirby common stock valued at approximately US$355 million, subject to certain closing adjustments. The closing of the acquisition is expected to occur in the third quarter (3Q17) and is subject to customary closing conditions, including regulatory approvals under the Hart-Scott-Rodino Act.

Mr. Pyne commented, "The combination of Stewart & Stevenson with Kirby's existing distribution and services business has the potential to unlock significant strategic value, dampen overall volatility in the business, and create a larger organisation at an opportune time, as the industry continues to recover from a deep downturn. We are pleased to welcome the management and employees of a globally-recognised company with 115 years of history. We welcome the support of Parman Capital Group as a major shareholder of Kirby Corporation."

Mr. Grzebinski, Kirby's President and Chief Executive Officer, concluded, "We expect this acquisition will be modestly accretive to 2017 earnings per share, and expect more meaningful accretion in 2018 as we consolidate operations and capture synergies. We will provide updated 2017 guidance on our third quarter earnings release call. We will also provide full year 2018 revenue and earnings per share guidance, including accretion from Stewart & Stevenson, when we report earnings in January 2018."

Read the article online at: https://www.hydrocarbonengineering.com/petrochemicals/14062017/kirby-corp-to-purchase-stewart-stevenson/


 

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