Griffith Energy Services, a wholly owned subsidiary of CH Energy Group, announced earlier this month that is has sold off parts of its operations serving markets in Rhode Island, Connecticut and Pennsylvania as part of a “strategic streamlining that will reduce the volatility of cash flow” according to a press release, and allow Griffith, a fuel oil delivery firm headquartered in Maryland, to focus on its Mid-Atlantic operations.
Canadian-based Superior Plus is acquiring approximately 47,000 customers in the deal, and will pay Griffith approximately $76 million, pending adjustments arising when the deal is closed, likely in December.
“We are very pleased with this transaction,” said CH Energy Group Chairman, President and CEO Steven V. Lant.
Lant said the deal follows a year-long strategic review of how to optimize Griffith”™s strengths in its most advantageous markets, but to “also ”˜right size”™ the investments we hold in the fuel oil delivery industry within CH Energy Group”™s portfolio of business units.
“Despite the excellent performance of Griffith throughout the markets it serves, we became concerned in 2008 about the effect of high oil prices on our working capital requirements,” said Lant. “This sale consolidates operations in our strongest market area, reduces cash flow volatility and allows us to realize a gain for our shareholders.”
Griffith will retain approximately 60,000 customers in several Mid-Atlantic states.
