(AP) — A Canadian fuel supplier and reseller plans to enter the U.S. market with a $110 million purchase of a North Dakota fuel distribution business.
Parkland Fuel Corporation, which is based in Red Deer, Alberta, said it is buying all outstanding shares of SPF Energy Inc., the parent company of Farstad Oil Inc. and Superpumper Inc. for $89 million cash and about $21 million in common shares of Parkland. The transaction is expected to close on Jan. 1.
The company’s strategy is to grow in areas with strong future prospects where it can immediately add value through strong supply capability, said Parkland President and CEO Bob Espey.
“Extending our operations into the Northwest United States, an area experiencing strong economic growth, fits both these parameters,” Epsey said in a statement. “Parkland’s acquisition plan has progressed faster than originally anticipated due to a strong acquisition pipeline that continues to present us with a number of very attractive opportunities.”
Minot, N.D.-based SPF Energy supplies 300 million gallons of refined petroleum products including gasoline, distillates and lubricating oils throughout North Dakota, Montana, Minnesota, South Dakota and Wyoming. The company services more than 200 independent gasoline stations. It also has rail trans-loading facilities and 40,000 barrels of bulk storage in the town of Minot.
SPF Energy since 1938 has grown from family-operated bulk fuels business into North Dakota’s largest distributor.
SPF Energy CEO Jeff Farstad said his company’s employees should have plenty of opportunities to grow with Parkland.
“As I retire, it is comforting to know that our employees are joining a family that cares about customer service, cares about their employees, and has the integrity to always do the right thing,” Farstad said in a statement. “Having met Parkland’s management team, I am confident that our employees will have great opportunities to grow with Parkland, and that they will be treated very well.”
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