Superior Plus to acquire Certarus to form major lower carbon fuels platform

Superior Plus will acquire Certarus, a North American low carbon energy solutions provider, for CAD 1.05bn ($770 million) including debt.

The transaction value constitutes equity value of CAD 853 million ($629 million) and assumption of Certarus’ outstanding senior bank credit and leases valued at CAD 196 million ($144.4 million).

Certarus shareholders will own approximately 17% of the combined entity, as they receive CAD 353 million in cash and CAD 500 million of Superior Plus common shares rated at CAD 10.25 per share.

The acquisition is expected to add high organic growth low carbon CNG, RNG, and hydrogen distribution platform to Superior Plus’ energy distribution business.

Certarus delivers over-the-road low cost and low carbon fuels, including CNG, RNG, and hydrogen through mobile storage units (MSUs), which are interchangeable between CNG, RNG, and hydrogen, across North America.

The energy company offers a virtual pipeline to its customers who do not have proper infrastructure in place.

Luc Desjardins — Superior Plus President and CEO said: “The acquisition of Certarus is a highly strategic and transformative transaction for Superior as it represents an exciting opportunity for significant organic growth and provides our existing and new customers with the ability to meet their ESG goals through our low carbon energy distribution platform.

“With our execution on the Superior Way Forward strategic initiatives in the past 24 months, we are ahead of our timing to achieve CAD 700 million to CAD 750 million in EBITDA from operations as we now expect to reach the lower end of the target by 2024.”

Certarus with18 hubs throughout Canada and the US, anticipates to have 640 MSUs by year end.

Curtis Philippon — Certarus President and CEO said: “Certarus will benefit from Superior’s scale, portable fuel distribution expertise, and a shared commitment to safety.

“The joining of our businesses creates a strong platform upon which we can continue to grow and provide decarbonization solutions, including RNG and hydrogen.”

The acquisition is anticipated to complete in the first quarter of 2023, subject to regulatory, court, and stock exchange approvals as well as customary closing conditions.