Arsenal Considers Selling Logistics Business

Posted by Eric Haun
Friday, May 02, 2014

Private equity firm Arsenal Capital Partners is considering a sale of its business that helps U.S. oil and chemical companies reclaim import taxes, a partner at the firm said.

Timothy Zappala told Reuters that other options for the company, Charter Brokerage, included buying businesses in the same sector that would make a good fit with Charter.

He declined to put a price tag on Charter but a source familiar with the matter said it could be valued at up to $500 million.

Charter, which has annual net revenue of about $65 million to $70 million, is the largest U.S. petroleum and chemical drawback services provider.

A drawback is the refund of import duties and taxes on a product when a form of that same product is exported. Charter Brokerage connects importers and exporters in the petroleum and petrochemical industries to arrange such refunds.

New York-based Arsenal, which manages over $1.6 billion in investments, has hired Morgan Stanley to look at strategic options for Charter, Zappala said in an interview.

"We're a private equity firm, so we're always open to selling companies at the right value, but I think that's just one of the options we are considering for Charter considering their strong market growth dynamics," he said.

The possible sale comes at a time when consolidation is expected to pick up among U.S. logistics services providers - an industry that depends largely on acquisitions for growth - after a slow start in the first quarter.

PricewaterhouseCoopers said in a recent report that valuations for acquisition targets in the logistics industry in developed economies were recovering "regardless of whether strategic or financial investors were involved." (http://r.reuters.com/xyg98v)

Neovia Logistics LLC, backed by Caterpillar Inc, is exploring a sale that could value the company at more than $1 billion, people familiar with the matter told Reuters last week.

Private equity firm Oak Hill Capital Partners hired JPMorgan Chase & Co to explore a sale of logistics provider Jacobson Companies Inc, hoping to fetch as much as $700 million, Reuters reported in February.

Zappala, a former Dow Chemical Co executive who sits on Charter's board, said Arsenal would also consider buying other companies to complement Charter's services.

"The company is growing very rapidly, due to the increased trade flows around petroleum and chemical products. We would probably lean towards maintaining it longer, based on that," he said.

"If we decided to sell, the most likely buyer would be a logistics strategic who wanted access to the long-standing Charter relationships with the major petroleum and chemicals companies."

Founded in 1994, Charter manages customs clearance documentation for importers and exporters in the United States and Canada, which allows them to draw back import duties and taxes.

Arsenal invests in middle-market specialty industrial and healthcare companies.

It acquired Charter from Summit Park Partners in 2008 for an undisclosed sum, and recapitalized the company in 2012.

(By Sagarika Jaisinghani; Additonal reporting by Greg Roumeliotis and Mike Stone in New York; Editing by Saumyadeb Chakrabarty)

Maritime Reporter February 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Shipping Confidence Hits 2.5 Year Low

Overall confidence levels in the shipping industry fell to their lowest level for two-and-a-half years in February 2015, according to the latest Shipping Confidence

U.S. DoI Upholds 2008 Shell Arctic Lease

The U.S. Interior Department on Tuesday upheld a 2008 lease sale in the Chukchi Sea off Alaska, moving Royal Dutch Shell a step closer to returning to oil and gas

All American Marine Delivers Ferry to Seattle

All American Marine, Inc. (AAM) today announced the delivery of a new passenger ferry that will serve the city of Seattle.    The vessel, MV Sally Fox, was dedicated

Finance

Hermes Unit, Canadian Fund to Buy $2.4B Stake in UK Ports Group

The Canada Pension Plan Investment Board (CPPIB) and Hermes Infrastructure are prepared to buy a 30 percent stake in Associated British Ports for about 1.6 billion pounds ($2.

Baltic Sea Freight Index Up on Higher Capesize Rates

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, rose on Tuesday, mostly on higher capesize rates.   The index,

Direct Le Havre to Charleston LCL Import Service

CaroTrans has announced the addition of an expedited Le Havre, France to Charleston LCL import service.    This is the only direct, weekly Le Havre to Charleston LCL service available in the market.

News

U.S. DoI Upholds 2008 Shell Arctic Lease

The U.S. Interior Department on Tuesday upheld a 2008 lease sale in the Chukchi Sea off Alaska, moving Royal Dutch Shell a step closer to returning to oil and gas

All American Marine Delivers Ferry to Seattle

All American Marine, Inc. (AAM) today announced the delivery of a new passenger ferry that will serve the city of Seattle.    The vessel, MV Sally Fox, was dedicated

HEADHUNTER Marine Sewage Treatment Systems

Headhunter’s team of engineers, fabricators, and wastewater specialists work together to provide innovative and efficient sewage treatment solutions.   Offering systems in three categories; STP,

Logistics

U.S. DoI Upholds 2008 Shell Arctic Lease

The U.S. Interior Department on Tuesday upheld a 2008 lease sale in the Chukchi Sea off Alaska, moving Royal Dutch Shell a step closer to returning to oil and gas

Direct Le Havre to Charleston LCL Import Service

CaroTrans has announced the addition of an expedited Le Havre, France to Charleston LCL import service.    This is the only direct, weekly Le Havre to Charleston LCL service available in the market.

DryShips to Sell its Suezmax Tanker Fleet

DryShips Inc. (NASDAQ: DRYS), has announced  that it has entered into firm sales agreements with entities controlled by the Company's Chairman and Chief Executive Officer,

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Naval Architecture Navigation Offshore Oil Pod Propulsion Port Authority Sonar Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1847 sec (5 req/sec)