Parkland Fuel Corp. buys Farstad, Superpumper
RED DEER, Alberta Parkland Fuel Corp., Canada's largest independent supplier and reseller of fuels and petroleum products, announced Friday that it plans to acquire North Dakota's SPF Energy Inc., the parent company of Farstad Oil Inc. and Superpumper Inc.
"Our strategy is to grow in areas with strong future prospects where we can immediately add value through our strong supply capability. Extending our operations into the northwest United States, an area experiencing strong economic growth, fits both these parameters," said Bob Espey, president and chief executive officer of Parkland.
SPF supplies and distributes 300 million gallons of refined petroleum products throughout North Dakota, Montana, Minnesota, South Dakota and Wyoming. Their primary products include gasoline, distillates and lubricating oils. The company services more than 200 independent gasoline stations, 60 of which carry a major's brand. SPF also has rail transloading facilities and 40,000 barrels of bulk storage in Minot.
SPF has grown since 1938 from a family-operated bulk fuels business into the largest distributor in North Dakota. Parkland indicated that it will ensure that SPF continues to be locally operated.
"As I retire, it is comforting to know that our employees are joining a family that cares about customer service, cares about their employees, and has the integrity to always do the right thing," said Jeff Farstad, chief executive officer of SPF.
The acquisition is subject to various third-party and regulatory consents, including the approval of Toronto Stock Exchange. Closing is expected by Jan. 1, 2014.
The outstanding shares of SPF would be purchased for about $110 million in Canadian dollars, consisting of about $89 million cash and about $21 million in common shares of Parkland.
SPF's adjusted earnings before interest, tax, depreciation and amortization for the four quarters ending June 30, 2013, was about $20 million.