Two Major Distributors Merge

SC Fuels completes acquisition of United Fuel & Energy Corp.

Published in CSP Daily News

ORANGE, Calif. -- Southern Counties Oil Co. (SC Fuels) completed its acquisition of United Fuel & Energy Corp. through a merger of United Fuel with and into Goldstream Inc., a wholly owned subsidiary of SC Fuels.

United Fuel & Energy is one of the largest distributors of gasoline, diesel, propane and lubricant products in the Southwestern and South Central United States. The company is comprised of more than 115 unattended fueling sites, bulk plants and offices in Texas, New Mexico and Oklahoma.

SC Fuels, established in 1930, is the oldest and largest petroleum [image-nocss] distributor in the West. Serving 35,000 customers annually, ranging from small family-owned businesses to Fortune 500 companies. SC Fuels delivers branded, unbranded and alternative commercial fuels in 10 western states.

SC Fuels also has a network of 185,000 commercial cardlocks, truckstops and retail stations nationwide. It also manages a fleet-card program and provides mobile onsite fueling for customers who desire having their vehicles fueled on-site during off hours.

Frank P. Greinke, currently first vice president of the Societyof Independent Gasoline Marketers of America (SIGMA), is CEO of both companies, and will continue to lead the merged company as chairman of the board and majority shareholder.

Matrix Capital Markets Group Inc., Richmond, Va., provided financial advisory services and a fairness opinion to a special committee of the board of directors for United Fuel & Energy on the merger.

Matrix's advisory team was led by Tom Kelso, managing director, Spencer Cavalier, director, and Cedric Fortemps, vice president. Said Cavalier: "It was an honor to work with the members of the special committee, who did an excellent job maximizing shareholder value."

The merger, completed February 10, comes more than two years after United Fuel & Energy acquired Cardlock Fuels System Inc., the cardlock operations of SC Fuels, which Greinke owned.

At that time, United Fuel & Energy issued approximately 24.6 million shares of United Fuel & Energy common stock to Greinke at a price of $1.50 per share, giving him approximately 51.5% ownership in that company.

United Fuel, Orange, Calif., represents the consolidation of numerous companies, the most significant of which was the Eddins-Walcher Co. and Cardlock Fuels System.

SC Fuels, also based in Orange, Calif., is a California limited partnership that distributes petroleum products throughout the western United States.

Goldstream Inc. is a Nevada corporation and a direct, wholly owned subsidiary of Southern Counties Oil Co. It is engaged in the business of distributing gasoline, diesel and lubricant products primarily in certain markets of Texas, California, New Mexico, Arizona and Oklahoma.