Kildair Services Ltd. Sells 50% Interest to Sprague Energy
Acquisition of Stake in Kildair Service Ltd. Marks Sprague's Entry into Canada
ST. PAUL-DE-JOLIETTE, QC, and PORTSMOUTH, NH, October 11, 2007 - Sprague Energy Corp., a leading energy wholesaler in the Northeastern United States, has completed its previously announced acquisition of 50% of Group Delangis. Group Delangis of St-Paul-de-Joliette, Quebec, Canada, is a third-generation family business controlled by Jean Delangis, and their subsidiary, Kildair Service Ltd. Kildair is one of the premier asphalt and heavy fuel marketers in Quebec.
The transaction closed on October 10th, 2007. Terms of the transaction will not be disclosed
Kildair is a leading player in the residual fuel and asphalt markets, with 1.7 million barrels of storage in the greater Montreal area. The partnership with Kildair augments the capabilities of Sprague, which has marketed industrial fuels for more than 130 years, and has become the largest provider of asphalt storage services in the Northeastern United States.
Jean Delangis, President, Chairman, and Owner of Group Delangis, said he was delighted to have concluded the partnership: "Combining our mutual business experiences will allow Kildair Service Ltd. and the companies of Group Delangis to share in the same fields of activities a full partnership with Sprague. This constitutes a major and extremely interesting challenge as both the rules of the local game and the rules of the global market impose constant daily pressures on our company; by this merger we secure our present as well as our future. In short, the Sprague Energy team brings us additional support and expertise, while we contribute through our knowledge and expertise, as well as our facilities and equipment, which are simply unequalled in North America. Our human resources, sub-contractors, and service suppliers form the basis and strength of our organization and we are really enthusiastic and happy, as are Sprague Energy's people, to undertake our new partnership in the coming months."
"We are very excited about our new partnership with Group Delangis," said John McClellan, Sprague's President and CEO. "Jean Delangis has created a vibrant marketing business in residual fuel and asphalt, leveraging a first class terminal with state-of-the-art blending capabilities for both residual fuels and asphalt products. Jean's outstanding reputation in the Quebec and Ontario markets has carried Kildair to a position where they are the preferred supplier to some of the most attractive-and demanding-customers in Eastern Canada. Through this investment, Sprague can continue its growth into a new market with a partner with proven capabilities, unique assets and a sound strategy."
The Kildair customer base for residual fuel includes power plants and industries throughout Eastern Canada, as well as ships on the St. Lawrence River. A growing share of Kildair's business comes from asphalt, both tank leasing, as well as direct sales to highway construction firms.
Kildair has carved out a strong position by providing value-added services to customers that have unique transportation or product specification requirements that Kildair's assets are designed to meet.
Jean Delangis has agreed to remain as Chairman of the company, so his expertise and the relationships that he has built will remain an integral part of the Group's future growth strategies.
"This partnership will be a two-way street," added McClellan. "While we will be contributing capital and some relevant expertise, I have seen already that Sprague will be learning a great deal from Mr. Delangis and the team that he has built."
About Sprague Energy Founded in 1870 as a supplier of coal and oil, Sprague Energy Corp. has evolved into the Eastern Seaboard's leading resource for industrial, commercial, space heating and transportation fuels, as well as material handling services. Sprague distributes more than 2.5 billion gallons of petroleum products, 160 Bcf (billion cubic feet) of natural gas, and handles in excess of 3 million tons of bulk materials in a safe and environmentally sound manner. Sprague, based in Portsmouth, New Hampshire, is a wholly-owned subsidiary of Axel Johnson Inc., a member of the Axel Johnson Group of Stockholm, Sweden.
Please visit Sprague's web site at www.spragueenergy.com.
About Delangis Group and Kildair Service Ltd. Established in 1929, the Delangis Group started by specializing in road transportation via Delangis Express. In the course of years-and generations-the group expanded and acquired, in 1966, Kildair Service Ltd. that specialized in regional air transportation and quickly focused its operations on the leasing of trucks and semi-trailers.
During the 80s, Kildair diversified into the sale and transportation of petroleum products. The subsequent years would be a turning point for the company, with the acquisition of three tanks in the Sorel-Tracy area and a pipeline directly linking its terminal to the loading/unloading docks situated along the St. Lawrence River, making it a major player in the petroleum industry.
Thus, from a transportation company, Kildair has now grown into an ISO 9001:2000 registered company specialized in the production, distribution and storage of heavy fuel oil and liquid asphalt.
Please visit Kildair's web site at www.kildair.com.
For additional information contact: Group Delangis Jean Delangis President (450) 756-8091 jean.delangis@kildair.com
Sprague Energy Andy Lynch Manager, Marketing Communications (603) 430-5348 alynch@spragueenergy.com
