The owner of the Tesoro refinery and gas stations in Hawaii is buying the 76-brand gas stations in the state.
Houston-based Par Petroleum Corp., which bought the Hawaii assets of Tesoro last year, will pay $107 million to purchase Koko‘oha Investments Inc., the parent company of Mid Pac Petroleum LLC, owner of 80 76-brand gas stations and four petroleum product terminals in Hawaii.
The deal was announced Monday by Par Petroleum, which acquired the former Tesoro refinery, its 31 gas stations and other assets in September.
Mid Pac’s retail gasoline operations account for about 12 percent of the market, while Par Petroleum’s stations, which still operate under the Tesoro brand, comprise about 9 percent to 10 percent.
"Acquiring Mid Pac will provide a unique expansion opportunity for our Hawaii business," said William Monteleone, Par Petroleum’s chief executive officer, in a statement.
"Access to additional retail sites will provide synergies by increasing on-island sales of our refined products, optimizing distribution costs and enhancing crude slate flexibility," he said.
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PAR PETROLEUM’S HAWAII HOLDINGS
» 31 Tesoro gas stations and refinery
» 80 76-brand gas stations and four petroleum product terminals* *Pending sale closing
Source: Par Petroleum
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Mid Pac’s ownership of the real estate under its retail locations, terminals and office space "provides excellent underlying asset value," added Monteleone.
No Mid Pac employees will lose their jobs as a result of the still-pending acquisition, according to Mid Pac President and CEO Jim Yates.
"I’m pleased that Par Petroleum does not foresee making any staffing changes as they welcome Mid Pac employees to their family of companies," he said.
Par Petroleum officials anticipate the deal will close in the third quarter of 2014, subject to regulatory and other approvals.
Par Petroleum paid $539 million for the refining, distribution and retail operations of Tesoro in Hawaii. The total included $75 million for Tesoro’s assets and $464 million for the company’s inventory of crude oil and refined products.
The Tesoro stations are operated by Par Petroleum subsidiary HIE Retail, which secured a $30 million loan to buy the stations from sister-subsidiary Hawaii Independent Energy.
The former Tesoro refinery in Kapolei, with a capacity of 94,000 barrels per day, had been on the market for 18 months at the time Par Petroleum announced its intention to acquire Tesoro’s Hawaii assets.
At the time, Monteleone said the company was "looking forward to being a reliable and productive member of the Hawaii business community."
Par Petroleum subsidiary Hawaii Independent Energy has more than 500 employees responsible for the manufacture and distribution of gasoline, diesel, marine fuel and fuel oil.
Hawaii-based Mid Pac has 150 employees within its retail gas stations, petroleum product terminals and trucking operations.
