Getty Petroleum Restructuring
Published in CSP Daily News
Includes sale of 164 stations, 339 contracts, to LUKOIL North America
EAST MEADOW, N.Y. -- Getty Petroleum Marketing Inc. said that it has completed the sale of 164 branded gas station properties, contracts to supply approximately 339 other stations and other assets, including its home heating oil and propane gas company, to LUKOIL North America LLC (LNA), for $195.5 million. The move is part of Getty's restructuring that includes exiting the direct-supplied retail gasoline business. Under the restructuring, Getty has sold all assets unrelated to the 890 properties leased from Getty Realty Corp.
Vadim Gluzman, CEO of LUKOIL North America, [image-nocss] stated, "LNA is expected to be the vehicle through which Lukoil will concentrate its future growth in the United States."
As reported in a CSP Daily News Flash yesterday, the restructuring is part of Getty's ongoing efforts to rationalize assets, eliminate parent-guaranteed debt and reduce operating costs.
Getty also announced additional steps to manage costs including closing two marketing regions and eliminating 194 jobs, as well as getting out of the direct-supplied retail gasoline business.
In September 2009, Getty sold assets and inventory related to its blending and supply to LUKOIL Pan Americas LLC for $25.4 million. Divesting this capital-intensive unit, which blended and traded physical product, relieves Getty of significant parent guaranteed short-term debt obligations. LUKOIL Pan Americas trading operations are unrelated to Getty.
The assets sold are unrelated to the properties leased from Getty Realty Corp.
Getty is using the sale proceeds to pay off parent guaranteed long-term borrowings.