OVERLAND PARK, Kan., June 23 /PRNewswire-FirstCall/ -- Ferrellgas
Partners, L.P. (NYSE: FGP), today announced an agreement to sell certain non-
strategic storage and terminal assets from its operating partnership to
Enterprise Products Partners, L.P. (NYSE: EPD) of Houston, Texas.
The sale price for the assets is $144 million in cash, plus a post-closing
payment for, among other things, accounts receivable and inventories.
Completion of the proposed sale is subject to customary conditions and is
scheduled to close by July 31, 2005.
Included in the sale are the company's underground storage facilities in
Adamana, Arizona; Hutchinson, Kansas; and Moab, Utah; along with rail and
pipeline-to-truck terminals and storage facilities in Inver Grove Heights,
Minnesota; Jackson, Minnesota; Sylva, North Carolina; and Aberdeen, North
Carolina. The facilities, which have a combined storage capacity of
approximately 257 million gallons, are currently managed by Ferrell North
America, the company's Houston-based operation.
"We are pleased to be working with a strong buyer for these assets, which
are not considered strategic to our core propane distribution business," says
Kenneth A. Heinz, Ferrellgas' Senior Vice President of Corporate Development.
"This sale is a culmination of an extremely competitive bid process and we
have enjoyed the opportunity to work with quality professionals like
Enterprise. We feel the transaction truly is a win for both companies."
The underground storage facilities were obtained by Ferrellgas in 1986
through its acquisition of Buckeye Gas Products Company, L.P. Those
facilities have a combined storage capacity of approximately 256 million
gallons (6.1 million barrels), enabling Ferrellgas to segregate commonly
stored products such as propane, butanes, pentane, mixed LPGs and other
specialty products. More than 70 percent of the combined storage space is
currently leased to third parties.
The terminal facilities consist of 43 bulk propane storage tanks with a
combined capacity of 1.4 million gallons (33,000 barrels), and provide
reliable supply to numerous retail and wholesale marketers in the region.
"As we have made clear to our investors, we are committed to reducing our
overall debt levels while improving our near-term operating results," says
James E. Ferrell, Chairman, President and Chief Executive Officer. "The
proceeds from the sale of these assets, together with our recent equity
offering, will be used to reduce debt, lowering our ratio of debt to Adjusted
EBITDA by more than 10 percent on a trailing 12-month proforma basis."
Under the terms of the asset purchase agreement, Ferrellgas will maintain
a certain level of storage volume and terminal throughput with Enterprise
Products Partners at the storage and terminal facilities for a period of five
years, with the option to extend for an additional five years.
Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas,
L.P., currently serves more than one million customers in all 50 states,
Puerto Rico, the U.S. Virgin Islands and Canada. Ferrellgas employees
indirectly own approximately 18 million common units of Ferrellgas Partners
through an employee stock ownership plan.
Statements in this release concerning expectations for the future are
forward-looking statements. A variety of known and unknown risks,
uncertainties and other factors could cause results, performance and
expectations to differ materially from anticipated results, performance and
expectations. These risks, uncertainties and other factors are discussed in
the Annual Report on Form 10-K of Ferrellgas Partners, L.P., Ferrellgas
Partners Finance Corp., Ferrellgas, L.P. and Ferrellgas Finance Corp. for the
fiscal year ended July 31, 2004, the Quarterly Report on Form 10-Q of these
entities for the fiscal quarter ended April 30, 2005, and other documents
filed from time to time by these entities with the Securities and Exchange
Commission.
CONTACT: Ryan VanWinkle, Investor Relations, 913-661-1528
Scott Brockelmeyer, Media Relations, 913-661-1830
SOURCE Ferrellgas Partners, L.P.
-0- 06/23/2005
/CONTACT: Investor Relations, Ryan VanWinkle, +1-913-661-1528, or Media
Relations, Scott Brockelmeyer, +1-913-661-1830, both of Ferrellgas Partners/
/Web site: http://www.ferrellgas.com/
(FGP EPD)
CO: Ferrellgas Partners, L.P.; Enterprise Products Partners, L.P.
ST: Missouri, Texas
IN: OIL UTI
SU: TNM
CM-JR
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2742 06/23/2005 08:00 EDT http://www.prnewswire.com