HOUSTON -- Consolidated Medical Management Inc. (CMMI) has executed a purchase agreement to acquire Troutman Oil Co. Inc., and US Fuel International Inc., both privately companies headquartered in Austin, Ark.
"This is an important acquisition for CMMI and its shareholders," said Timothy G. Byrd Sr., CMMI's CEO. "The addition of Troutman's distribution infrastructure, retail network and the US Fuel brand to our current terminalling operation moves us closer to establishing CMMI as a fully integrated fuel supplier, distributor and retailer, and positions [image-nocss] us to capture profits throughout the downstream chain.
Terms of the agreement have CMMI purchasing the stock of Troutman Oil, US Fuel and certain assets held individually by its shareholders for $5 million in cash, $900,000 in debt, and 666,680 shares of CMMI convertible preferred stock valued at $1 million. The final purchase price is subject to adjustment based upon the audit results of the companies' assets and liabilities.
"We are presently continuing to develop and expand this business model through both organic growth and by acquisitions of greater terminal capacity and increased geographical reach of branded retail fuel outlets within the consumer and commercial fuel distribution chains," Byrd added.
Troutman Oil distributes fuel to retail outlets throughout Arkansas and owns and operates 12 branded US Fuel stations in the mid-South. US Fuel is a fuel marketing company that sells fuel under the US Fuel trademark. US Fuel currently has a private-label US Fuel brand credit card program with more than 3,000 active cards establishing brand loyalty with its customer base.
"With storage at our Intercontinental Fuel terminal in Houston fully occupied, we look forward to continued corporate growth through this acquisition," said G. C. Sonny Wooley, CMMI's chairman. "We have also taken a giant step in securing other avenues for revenues and profit by expanding the infrastructure, management, and licenses to resell fuel, and maximizes utilization of our terminal operations."
Byrd said, Once completed, this acquisition is expected add over $23.5 million to the company's revenue.
Closing of the purchase is to occur on Dec. 10, 2007, but can be extended up to 90 days with an additional $50,000 payment. If closing does not occur, then the shareholders of US Fuel and Troutman Oil can keep the $10,000 deposit paid concurrent with the signing of the purchase agreement.
Troutman Oil is a fuel distribution company servicing retails outlets throughout Arkansas. US Fuel International offers fleet fueling franchise and branding programs to aggressive petroleum entrepreneurs. In addition, the company offers a variety of innovative programs in protected territories such as fleet fueling, fuel purchase cash cards, onsite fueling, unattended express marts, national referrals, regional and national co-op advertising, with co-branding with comprehensive training and marketing support. US Fuel offers programs and support to generate increased business in today's competitive marketplace.
CMMI is a wholesale fuel distributor and fuel terminal operator based in Houston. CMMI not only offers storage, delivery and blending of petroleum products such as gasoline and diesel fuel, but also offers biodiesel to the growing "green" fuels market.
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