Kirby Complete Penn Maritime Takeover
Kirby Corporation completes the acquisition of Penn Maritime Inc. & Maritime Investments LLC, US operators of tank barges and tugboats.
Penn's fleet, comprised of 18 double-hulled tank barges with a capacity of 1.9 million barrels and 16 tugboats, operates along the East Coast and Gulf Coast of the United States. Penn's tank barge fleet has an average age of approximately 13 years with a product mix that consists primarily of refinery feedstocks, asphalt and crude oil. Penn's customers include major oil companies and refiners, nearly all of whom are current Kirby customers for inland tank barge services.
Kirby Corporation (KEX), based in Houston, Texas, is the nation's largest domestic tank barge operator, transporting bulk liquid products throughout the Mississippi River System, the Gulf Intracoastal Waterway, coastwise along all three United States coasts and in Alaska and Hawaii. Kirby transports petrochemicals, black oil products, refined petroleum products and agricultural chemicals by tank barge.
The total value of the transaction was approximately $299 million (before post-closing adjustments and transaction fees), consisting of $146 million of cash, $29 million through the issuance of 500,000 shares of Kirby common stock valued at $58.16 per share, and $124 million for the retirement of Penn's debt. The cash portion of the consideration and retirement of Penn's debt were financed from the proceeds of a new issue of unsecured senior notes.
Kirby also provides after-market service for medium-speed and high-speed diesel engines and reduction gears used in marine and power generation applications. They also distribute and service high-speed diesel engines, transmissions, pumps, compression products and manufactures and remanufactures oilfield service equipment, including pressure pumping units, for the land-based pressure pumping and oilfield service markets.