DCC plc (LON:DCC), the leading international sales, marketing and support services group, has announced that DCC LPG has expanded its US LPG business through the acquisition of the NES Group and has also reached agreement with SHV Energy to acquire its Dutch LPG business, Primagaz Nederland B.V., subject to competition authority approval.
NES Group markets, sells and delivers propane and other related products and services to residential and commercial customers in Connecticut, Rhode Island and Massachusetts. Headquartered in Brooklyn, Connecticut, the business employs approximately 70 people, has over 22,000 active customers and sells approximately 40,000 tonnes equivalent of product annually. NES Group is DCC LPG’s first acquisition in the north east of the US and will provide a platform for further development in a region characterised by strong underlying demand for propane.
The acquisition of NES Group is DCC LPG’s second material bolt-on acquisition in the US market, following the acquisition of Pacific Coast Energy in April 2019. DCC LPG now has operations across 14 states in the US and is well positioned to continue to grow and develop a significant LPG business in the large and fragmented US market.
DCC LPG recently agreed to acquire Primagaz from SHV Energy, subject to competition authority approval. The business is highly complementary to DCC LPG’s existing business in the Benelux region. Primagaz, which focuses on the bulk and cylinder LPG markets, serves approximately 10,000 customers and supplies over 28,000 tonnes of LPG annually. The transaction is expected to complete during the fourth quarter of DCC’s financial year ending 31 March 2021.
The combined enterprise value of the two transactions is approximately £60 million.
Commenting on the acquisitions, Donal Murphy, Chief Executive of DCC plc, said:
“I am pleased to announce two complementary acquisitions in our LPG division. NES Group provides DCC LPG with an entry point in the attractive New England region and clearly adds further scale to our growing US LPG business. The acquisition of Primagaz in the Netherlands will be an important addition to our European activities. These transactions, which were originated, diligenced and executed during a period of ongoing Covid-19 restrictions, demonstrate our ability to successfully build our business in an uncertain environment. The Group continues to have the platforms, opportunities and capability for further development across each of our four divisions.”