Dow divest US Gulf Coast marine, terminal operations Royal Vopak

Dow to divest US Gulf Coast marine, terminal operations to Royal Vopak

9:21 AM, 15th September 2020
Dow_image
Royal Vopak has agreed with Maersk to launch a 0.5 percent sulfur bunkering facility in Rotterdam – as part of the IMO 2020 strategy. (Representative Image)

MIDLAND, US: Dow said it has agreed to divest certain US Gulf Coast marine and terminal operations and assets to Vopak Industrial Infrastructure Americas, a joint venture of Royal Vopak and BlackRock's Global Energy & Power Infrastructure Fund, for $620 million.

The transaction includes marine and storage terminal operations and assets at Dow’s sites in Plaquemine and St. Charles, Louisiana and Freeport, Texas.

The deal is expected to close in the fourth quarter of 2020.

Further, Dow and Vopak Industrial Infrastructure Americas have entered into long-term service agreements, ensuring reliable and cost-advantaged services for existing Dow businesses at the in-scope sites.

Royal Vopak is a leading global independent tank storage company with over 400 years of expertise in independent storage and infrastructure services.

“Today’s announcement is another demonstration of our ongoing commitment to applying a best-owner mindset, supported by rigorous benchmarking and a focus on disciplined capital allocation,” said Jim Fitterling, chairman and chief executive officer of Dow.

“The transaction will enable Dow to deploy cash towards value-enhancing opportunities in our core businesses consistent with our capital allocation priorities including ensuring safe and reliable operations and paying down additional debt.”

Goldman Sachs acted as financial advisor to Dow and Mayer Brown provided legal support.

Dow continues to evaluate its ownership of non-revenue-generating assets across its global portfolio as announced on 6 July, when the company announced a signed agreement to sell its rail infrastructure and assets at six North American sites.

Also, as announced separately on 23 July, the company is taking other actions to exit non-competitive assets, it said.

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