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USD Partners to acquire Hardisty South terminal assets

Published by
Hydrocarbon Engineering,


USD Partners LP has announced that it has entered into an agreement to acquire entities owning the Hardisty South terminal assets from USD Group LLC; exchange USD Group LLC's economic general partner interest in USD Partners LP for a non-economic GP interest; and eliminate the USD Group LLC's incentive distribution rights in USD Partners LP for total consideration of US$75 million in cash and approximately 5.75 million common units. The cash portion of this transaction is expected to be funded with borrowings under USD Partners LP’s US$275 million senior secured credit facility.

Transaction highlights:

  • Increases size, scale and growth capacity of USD Partners LP’s asset base.
  • Expected to provide double-digit accretion to USD Partners LP’s distributable cash flow per unit in 2023, improving the potential for distribution per unit growth.
  • Supports Management’s focus on delivering sustainable, long-term distributable cash flow to USD Partners LP’s unitholders by improving contract profile tenor, anchored by a long-term contract with ConocoPhillips.
  • Optimises operational and commercial synergies of Hardisty Terminal and consolidates benefits of blue-chip diluent recovery unit (DRU) asset growth at the MLP for the benefit of all of USD Partners LP’s unitholders.
  • Elimination of IDRs and economic GP interest simplifies USD Partners LP’s financial structure and better aligns the interests of its unitholders with USD Group LLC, who will continue to own a substantial number of common units post-transaction.

Read the article online at: https://www.hydrocarbonengineering.com/tanks-terminals/04042022/usd-partners-to-acquire-hardisty-south-terminal-assets/

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