Irish sales, marketing, distribution and business support services provider DCC Plc (ISE:DCC) announced on Wednesday it had agreed to buy the British liquefied petroleum gas (LPG) distribution operations of BP Plc (LON:BP) for EUR51.3m (USD63.5m).
The transaction excludes BP’s automotive LPG business, which will be transferred to the company’s UK fuels value chain, BP said separately. Its chief operating officer Tufan Erginbilgic believes that DCC has the ability to build on the acquired business and portfolio.
The move follows BP’s announcement in February of its intention to divest its LPG bottles and tank-filling activities along with some of its wholesale LPG operations in the UK, Portugal, Austria, Poland, the Netherlands, Belgium, Turkey, China and South Africa.
The acquisition will strengthen DCC’s position as the leading oil and LPG sales, marketing and distribution business in the UK, its chief executive Tommy Breen said. The buyer will satisfy the cash-and-debt free purchase price in cash at completion, which is scheduled for the end of September 2012.
BP’s British LPG activities deliver about 87,000 tonnes of bulk and cylinder LPG on an annual basis to a broad range of industrial, commercial and domestic clients. The business operates from a network of 13 sites across the UK and has a headcount of 116 and a fleet of 62 delivery vehicles. Its net tangible operating assets amounted to some EUR38m at the end of 2011.
DCC noted that the footprint of this business complements its existing LPG unit in the UK, called Flogas.