Essar Oil UK group of companies announced acquisition of British oil major BPs 11.5 per cent equity in United Kingdom Oil Pipeline (UKOP) and 100 per cent interest in Northampton Terminal.
The Essar Group subsidiary in a statement said the acquisition in UKOP is designed to strengthen Essar's logistics infrastructure network in the UK. "Under the agreement, Essar will acquire an equity stake in the UKOP pipeline, a share of the contractual joint venture (with Shell) which runs the Kingsbury Terminal and a 100 per cent interest in the Northampton Terminal," Essar Oil UK said in a statement.
The acquisition of BP assets is being done by two of Essar Oil UK's wholly-owned subsidiaries -- Essar Midlands and InfraNorth, it added. While the company did not disclose the purchase amount involved, according to informed sources, the equity acquisition has been agreed on at a price in the range of $90 million to $100 million.
Commenting on the development, Essar Oil UK Chief Executive Officer S. Thangapandian said in a statement that the acquisition of these BP assets demonstrates the company's ongoing commitment to investing in and growing their businesses within the UK. "The acquisition will allow Essar to maintain its presence in a very competitive UK Midlands region and grow that current footprint. It currently supplies over 16 per cent of the UK's road transport fuel demand and this agreement will enable us to improve our competitiveness," he said.
"In addition, we will continue to expand our retail offering with a number of the 12 new stations we recently branded through an agreement with MPK being supplied from the two terminals," he added. Essar also said the company has 67 retail sites operational across England and Wales and has plans to grow its network to 400 such sites over the next five years.