US-based tank barge operator Kirby has signed an agreement to acquire offshore barge and tugboat operator Allied Transportation (Allied) for $116m.
Allied, a subsidiary of Allied Marine Industries, operates offshore barges and tugboats in the coastal transportation of petrochemicals, as well as dry sugar products, in the Northeast, Atlantic and Gulf Coast regions of the US.
The clients of Allied include petrochemical companies, most of which are currently customers of Kirby for inland tank barge services.
Allied has a fleet of ten coastwise tank barges with a total liquid capacity of 680,000 barrels, as well as three offshore dry-bulk barges of 48,000 dwt and seven tugboats.
Kirby chairman and chief executive officer Joe Pyne said that operating as a US Jones Act carrier primarily in the offshore petrochemical business, Allied has a coastal fleet that will help the company’s existing coastal and inland operations.
"In addition to enhancing Kirby’s ability to expand and strengthen certain existing customer relationships, the acquisition of Allied provides Kirby with a strong footprint from which to grow the petrochemical segment of our offshore business," Pyne said.
The company expects the earnings per share contribution from Allied to be between $0.06 to $0.08 for 2013.
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Kirby said the acquisition will be financed through its revolving credit facility and the company has received consent from banks to increase its unsecured revolving credit facility from $250m to $325m.
The deal is scheduled to be completed late in the third or early fourth quarter of 2012 subject to conditions.