Caltex Australia Limited has received the consent of the New Zealand Overseas Investment Office to its proposed acquisition of Gull New Zealand for a purchase price of NZD340 million (USD247.6 million). Caltex anticipates completing the acquisition on July 3, 2017.
The deal will be funded through a combination of existing and new bank debt arrangements and is expected to be earnings per share accretive by the end of its first full year of operation under Caltex ownership.
Gull New Zealand, which is owned by the Rae family of Perth, Australia, one of the richest families in Australasia, built its stake in the highly competitive New Zealand fuel retail market by taking a low-cost strategy. Gull New Zealand imports petroleum products into its state-of-the-art fuel terminal in Mount Maunganui, on the North Island’s central East Coast, which has a total storage capacity of 90 million litres. Gull New Zealand operates 77 retail sites in total, of which it controls 55 sites, a third of which are unmanned. Gull New Zealand also operates a further 22 supply sites. The company sells about 300 million litres of transport fuel annually.
In 2010, the Rae family sold its Gull fuel retailing operations in Western Australia for an estimated AUD523 million (USD396.3 million).
The purchase of Gull New Zealand was made after Caltex Australia’s purchase of Milemaker Petroleum, which owns and operates 46 service stations in Victoria, Australia, for AUD95 million (USD72 million), having failed to get regulatory approval to acquire Woolworths Australia.
Caltex Australia operates as a refiner, importer and marketer of fuels and lubricants, with a vast network of approximately 1,900 company-owned, franchised or affiliated sites in Australia. It is listed as CTX on the Australian Securities Exchange. Caltex Australia has established a large fuel import centre at the old Kurnell refinery in Sydney and has established a buying and trading arm in Singapore to supply its operations in Australia. The acquisition of Gull New Zealand "optimises Caltex's infrastructure position, builds trading and shipping capability, grows the supply base and enhances Caltex's retail fuel offering through low-risk entry into a new market."
The Caltex Australia purchase was preceded by the purchase by Z Energy of Chevron New Zealand’s fuel business for NZD785 million (USD571.8 million).