DCP Midstream Partners to Expand Wholesale Propane Business Into Mid-Atlantic Region With $49 Million Acquisition
DENVER, July 21 /PRNewswire-FirstCall/ -- DCP Midstream Partners, LP (NYSE: DPM) (the Partnership) today announced that it entered into an agreement with a subsidiary of UGI Corporation (NYSE: UGI) (UGI) to acquire Atlantic Energy, one of UGI's wholly owned subsidiaries, for $49 million in cash. Atlantic Energy owns and operates a marine import terminal with 20 million gallons of above ground storage in the Port of Chesapeake, Virginia. The assets serve as an important supply point for propane customers in the mid-Atlantic region, and will extend the Partnership's existing northeast U.S. wholesale propane business into the mid-Atlantic.
"This immediately accretive acquisition provides us with an excellent opportunity to expand upon our existing market position as one of the largest wholesale propane suppliers in the northeast," said Mark Borer, president and CEO of the Partnership. "One of the keys to our success in the wholesale propane business has been the breadth of our supply options. The addition of the Chesapeake assets will build on our supply and logistics capabilities and help in continuing to ensure reliable deliveries to our customers. Given the nature of our business model and contracts, this business will contribute 100 percent fee-like margins to our asset portfolio."
The Partnership intends to use borrowings under its revolving credit facility to finance the expected closing of the acquisition in August.
DCP Midstream Partners, LP (NYSE: DPM) is a midstream master limited partnership that gathers, processes, transports and markets natural gas, transports and markets natural gas liquids, and is a leading wholesale distributor of propane. DCP Midstream Partners, LP is managed by its general partner, DCP Midstream GP, LLC, which is wholly owned by DCP Midstream, LLC, a joint venture between Spectra Energy and ConocoPhillips.
This press release contains forward-looking statements as defined under the federal securities laws regarding DCP Midstream Partners, LP, including projections, estimates, forecasts, plans and objectives. Although management believes that expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to be correct. In addition, these statements are subject to certain risks, uncertainties and other assumptions that are difficult to predict and may be beyond our control. If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, the Partnership's actual results may vary materially from what management anticipated, estimated, projected or expected.
Investors are encouraged to closely consider the disclosures and risk factors contained in the Partnership's annual and quarterly reports filed from time to time with the Securities and Exchange Commission. The Partnership undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Information contained in this press release is unaudited, and is subject to change.
SOURCE DCP Midstream Partners, LP