- Mergers & Acquisitions
Delek US closes sale of AltAir Paramount and Paramount refinery and pipeline assets to World Energy
Delek US Holdings, Inc. announced that it has signed and closed the sale of AltAir Paramount, LLC and Delek’s Paramount, Calif., U.S.A., refining and pipeline assets to an affiliate of Boston-based World Energy, LLC.
The sale includes all of Delek’s membership interests in AltAir Paramount, LLC which operates a 3,000 barrel per day renewable diesel/ renewable jet fuel facility, Delek’s idled Paramount refinery, and associated pipelines and storage tanks. Based on Delek’s ownership interest in AltAir Paramount, LLC the transaction should result in expected proceeds to Delek of approximately USD 72 million, taking into consideration estimated working capital, Delek’s portion of the biodiesel tax credit for 2017 and deal costs.
“We have been focused on deriving value from our non-core assets in California as they are outside of our geographic footprint. This marks the second step in this process following the announced agreement to divest five west coast asphalt terminals for USD 75.0 million,” said Uzi Yemin, chairman, president and chief executive officer of Delek. “The Paramount transaction provides additional cash to Delek and should enable us to reduce costs. We continue to evaluate options for our Long Beach and Bakersfield assets. Cash proceeds from this and future transactions could be used in our capital allocation program to return cash to shareholders.”
Vandewater Capital Holdings, the lead investor and controlling shareholder of AltAir Fuels from its inception in 2013 until Delek acquired a controlling stake in October of 2015, brought AltAir from concept to a leading refinery of renewable fuels.
Describing AltAir’s track record, Jason Aintabi, Vandewater’s founder, and previous chairman and CEO of Altair, said, “We are very proud of what we were able to accomplish here. Altair is a globally recognized facility that has helped pioneer an era of impact investment in America’s energy future. Our sustainable fuels are proudly used by the Department of Defense, United Airlines, UPS as well as other prominent companies.”
Delek US Holdings, Inc. is a diversified downstream energy company with assets in petroleum refining, logistics, asphalt, renewable fuels and convenience store retailing. The refining assets consist of refineries operated in Tyler and Big Spring, Texas, El Dorado, Ark., and Krotz Springs, La., with a combined nameplate crude throughput capacity of 302,000 barrels per day.
The logistics operations consist of Delek Logistics Partners, LP. Delek US Holdings, Inc. and its affiliates also own approximately 63% (including the 2 percent general partner interest) of Delek Logistics Partners, LP. Delek Logistics Partners, LP is a growth-oriented master limited partnership focused on owning and operating midstream energy infrastructure assets.
The convenience store retail business is the largest 7-Eleven licensee in the United States and operates approximately 300 convenience stores in central and west Texas and New Mexico.