NEW YORK & SAN RAMON, Calif. -- A private-equity firm with "a track record of fixing up underappreciated businesses" will take a swing at convenience retailing and fuel refining with its purchase of Chevron Corp.'s assets in Hawaii.
“We look forward to building upon the strong foundation that Chevron has established in Hawaii over the past several decades," said Tony W. Lee, managing partner of One Rock Capital Partners, in announcing the deal this week.
One Rock has agreed to purchase Chevron Corp.'s 58 retail service stations, four product distribution terminals, pipeline distribution systems and other related downstream assets in Hawaii, as reported in a McLane/CSP Daily News Flash. The deal includes the 58,000-barrel-per-day refinery in Kapolei.
“The entire One Rock team is excited to be able to provide operating expertise to such a vital component of the Hawaii energy landscape, as these assets deliver important refined petroleum products to the islands’ utilities, airlines and motorists,” One Rock managing partner R. Scott Spielvogel said.
The sale was a long time coming as Chevron Corp., San Ramon, Calif., first acknowledged almost six years ago that it intended to sell its assets in Hawaii, dubbing them "not core" to its business.
"We have engaged in an investment banker to determine the level of interest there might be for someone to acquire us," a Chevron spokesperson said in 2014. "We have asked them to make some inquiries in the industry."
Although terms of the deal were not disclosed, industry estimates pegged its value between $75 million and $300 million. At least one report said the longstanding Chevron fuel flag on the sites will be replaced with the Texaco brand.
The agreement is subject to customary regulatory approvals and is expected to be completed during the second half of 2016.
One Rock Capital Partners, New York, makes controlling investments in companies with potential for growth and operational improvement using an approach that utilizes highly experienced operating partners to identify, acquire and enhance businesses in select industries.
One Rock also has a strategic relationship with Mitsubishi Corp., which can provide strategic resources to One Rock and its portfolio companies, including access to potential new business partners, market intelligence and low-cost sourcing through increased purchasing power globally.
David Hackett, president of Stillwater Associates, an Irvine, Calif.-based consultancy that advised One Rock in the acquisition, said Mitusbishi would play a support role in the Chevron deal.
"Mitsubishi is an investor in One Rock," Hackett told Oil and Gas Investor. "They trade oil. They got a refinery. They're providing support to One Rock on this. They're not running it."
The acquisition of Chevron's downstream assets will mark the first oil-refining company in One Rock Capital's portfolio, which includes a holding company for landscape service providers, and companies that manufacture food, chemicals and urinalysis supplies.
"[One Rock's] plans are to run it," Hackett told the publication. "They've got a track record of fixing up underappreciated businesses."
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