Capital Properties, Inc. (Capital) has announced that it has signed a definitive agreement to sell the petroleum storage terminal and Wilkesbarre Pier in East Providence, Rhode Island to Sprague Operating Resources LLC (Sprague), a subsidiary of Sprague Resources LP, for US$23 million in cash at closing. The terminal's combined distillate storage capacity of just over 1 million bbls has been leased exclusively by Sprague since 1 May 2014. The closing is subject to customary terms and conditions and is expected to occur within 30 days.
The company expects to use proceeds from the sale, net of income taxes, to redeem its 5% dividend notes due 26 December 2022. Robert H. Eder, Chairman of the Company, said, "We are pleased to announce the agreement today to sell our petroleum storage assets. The changing nature of the distillate market in southeastern New England requires the conversion of a significant portion of the terminal's capacity to gasoline products, which would involve significant capital investment and substantial additional risk. The company's board of directors determined that it was in the company's and its shareholders' best interest to divest these assets rather than undertake the conversion."
Read the article online at: https://www.tanksterminals.com/storage-tanks/26012017/capital-properties-to-sell-petroleum-storage-facility/