In a landmark move, Global Partners LP (NYSE: GLP), a leading integrated storage, distribution, and retail liquid energy company, announced the completion of its acquisition of 25 liquid energy terminals from Motiva Enterprises LLC. This strategic transaction, valued at $305.8 million in cash, significantly expands Global Partners LP’s operational footprint across the United States.

Strategic Implications of the Acquisition

This acquisition is a pivotal moment for Global Partners LP, effectively doubling their operating footprint. The deal, underpinned by a 25-year take-or-pay throughput agreement with Motiva, includes minimum annual revenue commitments, ensuring long-term financial stability and growth potential for Global. Eric Slifka, the President and Chief Executive Officer of Global Partners, emphasized the strategic importance of this expansion, stating, “This acquisition nearly doubles our operating footprint, giving Global a significant position from Maine to Florida and into the Gulf Coast.”

Enhanced Geographic Reach and Storage Capacity

With this acquisition, Global Partners LP now owns or leases a total of 49 liquid energy terminals in the United States, boasting approximately 18.3 million barrels in shell capacity. The new assets expand access to critical marine loading facilities and connect to major refined product pipelines such as Colonial, Plantation, Enterprise, Explorer, and Magellan. This enhanced capacity and geographic reach are poised to support the growth of Global’s integrated supply, storage, and retail network in key regions of the U.S., including Florida, Georgia, Texas, and the Carolinas.

Long-term Growth and Development

Reflecting on the significance of the acquisition, Slifka added, “This purchase marks a significant milestone in Global’s 90-year history and highlights our strategy to acquire and invest in assets where we can leverage our core strengths.” The acquisition represents an expected EBITDA multiple below 7.0x in the second year of ownership, indicating strong financial prospects. This deal not only represents a significant expansion in terms of physical assets but also strengthens Global Partners LP’s position in the energy sector, providing a robust platform for future growth and development.

Background of the Deal

Announced in November 2023, this deal represents a major strategic move for Global Partners LP, enhancing its presence in rapidly growing areas and ensuring a more comprehensive service offering to both existing and new customers. The acquisition aligns with Global’s long-term strategy of geographic expansion and increased capacity in the dynamic energy sector.

In conclusion, Global Partners LP’s acquisition of Motiva Enterprises LLC’s liquid energy terminals is a significant development in the U.S. energy infrastructure landscape. It marks a strategic expansion for Global Partners, enhancing their storage capacity, geographic reach, and connecting them to major pipelines, while also securing long-term growth prospects.

  Eric Slifka, Global Partners LP, Motiva Enterprises, Texas