Kirby to acquire Cenac Marine Services fleet for $244 million

Written by Nick Blenkey
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JANUARY 31, 2019 — America’s largest tank barge operator is about to get even larger. Kirby Corporation (NYSE: KEX) today announced that it has signed a definitive agreement to acquire the Cenac Marine Services, L.L.C. fleet for approximately $244 million in cash, to be financed through additional borrowings.

Cenac’s fleet consists of 63 30,000-barrel inland tank barges with approximately 1.9 million barrels of capacity, 34 inland towboats, and two offshore tugboats. Closing of the acquisition is expected to occur late in the first quarter of 2019 and is subject to customary closing conditions, including regulatory approvals.

Kirby also reported a fourth quarter 2018 loss of $24.4 million, compared with earnings of $231.3 million for the 2017 fourth quarter, after taking one-time $1.16 per share impairment charges primarily related to older coastal vessels that require ballast water treatment systems

David Grzebinski, Kirby’s President and Chief Executive Officer, commented, “While our quarter’s financial results were negatively impacted by one-time impairment charges in our coastal and Osprey barge businesses, the underlying results from operations were solid. Excluding the non-cash impairment charges, our earnings per share of $0.75 compares to our guidance range of $0.55 to $0.75.”

“The acquisition of Cenac’s young fleet of well-maintained inland tank barges and modern boats is an ideal complement to Kirby’s operations,” said Grzebinski. “Cenac has a strong history of operational excellence, and is well respected by the industry and its customers. Cenac’s inland fleet of 30,000-barrel tank barges, of which approximately 80% are clean and 20% are heated black oil vessels, has an average age of only four years. Similarly, Cenac’s fleet of modern inland towboats and offshore tugboats has an average age of only six years. The addition of these vessels to Kirby’s fleet will not only further reduce our average age profile, but will also further enable us to avoid significant capital outlays for new vessels in the future.”

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