Andeavor Logistics has acquired Western Refining Logistics, LP in a unit-for-unit transaction and assumption of US$280 million of net debt for a total enterprise value of approximately US$1.7 billion. This strategic combination further positions Andeavor Logistics as a growth-oriented, full-service and diversified company with growth opportunities across the combined geographic footprint.
Following this acquisition, Andeavor Logistics is well-positioned to grow organically in the Permian Basin, principally in the Delaware basin where the company has a strong logistics asset base, crude oil marketing capability and meaningful refining offtake.
Western Refining Logistics unitholders will receive Andeavor Logistics’ quarterly cash distribution for 3Q17 after they have exchanged their Western Refining Logistics units for Andeavor Logistics units. The 3Q17 distribution will be paid to all Andeavor Logistics unitholders of record as of 3 November. The distribution of US$0.9852 per unit represents a 1.5% increase over the previous quarterly distribution.
Andeavor Logistics continues to expect at least US$1 billion of annual growth investments over the next several years, consisting of at least US$500 – US$600 million in organic growth and acquisitions and the potential for US$400 – $500 million in drop downs from Andeavor. The company remains committed to achieving its targeted annual distribution growth of 6% or greater, distribution coverage ratio of approximately 1.1 times and debt-to-EBITDA at or below 4.0 times.
Greg Goff will continue to serve as Chairman and CEO, and Steven Sterin will continue to serve as President and CFO of the general partner of Andeavor Logistics.