INDUSTRY ANALYSIS
An industry acquiring
Since the first impacts of Covid-19 back in early 2020 , we , at Fuel Oil News , have closely followed the sector as it has adapted in the face of increasing challenges . From some of the busiest months , made all the more challenging with a number of furloughed staff members , through digital communications , to virtual events taking the place of the social gatherings previously so enjoyed .
Whilst many businesses in the UK have focused on staying afloat over the past 18 months , some have been riding the acquisition wave , moving from strength to strength and growing with new businesses under their belts . Here we take a closer look at some of the most recent mergers and acquisitions within the sector from the perspectives of both the buyers and the sellers .
Recent acquisitions In one of the most widely covered acquisitions in the industry , the Prax Group announced the successful completion of the strategic acquisition of Lindsey Oil Refinery , and its associated logistics assets in the UK , in March this year . This followed an agreement , signed in July 2020 , to purchase the refinery from energy major Total .
Also in March , environmental risk reduction business , Adler and Allan , announced the acquisition of three companies into the group : electrical specialists AMGS Electrical , hazardous material specialist Flotech Performance Systems Limited ( Flotech ) and industrial sewage specialist and underground infrastructure specialist Oneline Surveys .
The acquisitions followed changes to Adler and Allan ’ s senior leadership team and were said to support the company ’ s ambitious growth plans to solve more customer challenges in a broader range of sectors with a joined-up approach to its services .
Andrew Clarke , energy infrastructure director , Adler and Allan , said at the time : “ The acquisition allows us to further execute our strategy , helping clients maintain and decarbonise their energy infrastructure and install new electric vehicle ( EV ) infrastructure , as the world transitions to a mixed energy future . By combining this with our other energy and forecourt services , we are now able to be a much more strategic environmental partner to customers .”
14 Fuel Oil News | August 2021
Early April saw the completion of Greenergy ’ s acquisition of Republic of Irelandbased Amber Petroleum , the completion of which helped to give Greenergy a growing presence in Ireland where it currently markets through Inver Energy .
Speaking about this acquisition Christian Flach , Greenergy CEO , said : “ One of our key strategic objectives is to integrate our existing supply footprint with our expanding retail presence . The acquisition of Amber follows our recent retail investment in 230 retail sites in Canada and will enhance our capabilities in Ireland by building on our existing infrastructure , supply and retail operations . We look forward to welcoming the Amber team to Greenergy .”
Liam Fitzgerald , owner and managing director of Amber Petroleum also added at the time : “ Having served our loyal customers for over 40 years Amber ’ s success has been based on strong relationships with customers , suppliers and staff and we know that Greenergy shares these same values . I am confident that Amber will continue to grow its profile as part of the wider Greenergy organisation .”
Growth has also been seen in the retail sector , with companies such as Motor Fuel Group ( MFG ) acquiring six forecourts in the Lake District last year from AUK Investments Limited .
Commenting on the purchase at the time , William Bannister , chief executive officer at MFG said :
“ AUK is a well-respected family business in the Lake District and the six stations that we have purchased from them give us the opportunity to extend our network coverage into Cumbria in what is , normally , a thriving tourist area .”
In January this year , MFG signed an agreement to purchase seven operational stations and nine new to industry ( NTI ) sites from BP . This is part of a wider agreement including fuel supply for 100 sites . Commenting on the agreement , Jeremy Clarke , chief operating officer at MFG said :
“ We are particularly delighted with this transaction , given the quality of the operational assets and geographical spread of the NTI sites .
“ Six of the operating stations are in Scotland and one is in Surrey . The
NTI sites are spread throughout England and Scotland .”
Across Europe , DCC has had its finger on the pulse of businesses to acquire this year . Telling us more about the recent acquisitions of Jones Oil and Campus Oils Daire Keating , managing director cards , Austria & Ireland , DCC Retail & Oil , said : “ We are very excited about working with our new colleagues in Campus and Jones , having successfully completed the acquisitions during the first half of 2021 . Both acquisitions will significantly grow our customer base in the Irish market and , together with our Emo business and the recent launch of the Certa network , in partnership with Tesco , we are very well placed to service our customers across the entire Irish energy distribution channel .”
Elaborating further on how these acquisitions fit into Dublin-based DCC ’ s company strategy , Daire continued : “ The retail & oil division operates across eight European countries . We continue to scale the business and the recent activity in Ireland is fully aligned with this strategy . Our 40 years of experience in selling the energy required for our transport , commercial , and heating customers makes us the ideal owner of these businesses . We – in DCC plc – are helping our customers around the world to decarbonise by offering cleaner products such as biofuel in blended or pure forms . We will increasingly offer these cleaner solutions to our customers in the UK and Ireland – such as the new ones we gain with these acquisitions . Together with the recent Campus and Jones acquisitions we have also been developing and investing in both our UK and Irish lubricants distribution platforms . This is a really complementary area for DCC .”
When asked what advice he would give to businesses looking to sell , Daire Keating says : “ There is really one thing – preparedness . You can ’ t be prepared enough , from understanding the conversations that need to happen to knowing the value of your business , really knowing the numbers . Be prepared to state what you want ; do you want to stay within the business or walk away – companies , especially family businesses , can be very close to the heart , so this decision needs to be considered carefully .”
Ollie Newbold , partner