Baltic Oil Terminals PLC Acquisition of Haahr Tank-Lager A/S
Baltic Oil Terminals PLC ("Baltic" or the "Company") is pleased to announce that it has today entered into an agreement for the acquisition (the "Acquisition") of Haahr Tank-Lager A/S ("Haahr Tank") for US$ 9.9m (approximately £6.3m) in cash.
Haahr Tank operates a 160,000 cubic metres refined oils terminal, located at Aabenraa in Denmark. The Acquisition is being financed through the issue by Dan-Balt Terminals Limited, a 100% subsidiary of the Company, of Secured Fixed Rate Loan Notes ("the Loan Notes") to the value of $11.0m (approximately £7.0m).
A valuation report, commissioned by Baltic, gives a new build cost of $42m. The purchase price reflects that, under the terms of the acquisition, the vendor Haahr Group will retain the use of 35,000 cubic meters of capacity at the terminal for the next five years.
Reasons for the Acquisition
The Board of Baltic believe that the acquisition of Haahr Tank represents a substantial step forward in the fulfilment of its strategy and that through the implementation of their operational model, already in place in Rotterdam:
- Its location, roughly midway between Baltic's Kaliningrad and Europort businesses, will provide enormous flexibility to Baltic's customer base
- Haahr Tank's two berths and ability to host larger oil tankers than in Kaliningrad will facilitate large volumes through the terminal as customers seek to bulk up shipments
- Haahr Tank's existing facilities requires little or no capital expenditure
- Longer term, there is space on the site for the expansion of capacity by approximately 20%
Simon Escott, CEO of Baltic, commented:
"This acquisition, alongside our existing businesses provides tremendous opportunities for our customers and ourselves: whilst our cash position and current cashflows means that servicing the financing of the acquisition does not put any undue strain on Baltic."
"The application of our business model, which has swiftly and substantially boosted profitability at our Rotterdam operations should equally stimulate a substantial increase in throughput at the terminal and therefore increased cashflow and profitability."