Acquisition Expected to Create Strong Synergies and Reunite ACL Management Team with Business It Helped Build
Jeffersonville, IN, Oct. 1, 2015 – American Commercial Lines (ACL) announced today it has signed a definitive agreement to acquire AEP River Operations from American Electric Power (NYSE: AEP).
AEP River Operations is a commercial inland barge company delivering approximately 45 million tons of products annually. The company is based in Chesterfield, Missouri, with operations in Paducah, Kentucky; and Convent, Algiers and Belle Chasse, Louisiana. ACL, a portfolio company of Platinum Equity, is based in Jeffersonville, Indiana, and is one of the most diversified marine transportation service companies in the United States.
ACL President and CEO Mark Knoy ran AEP River Operations for a decade before joining ACL in 2011. He said the proposed acquisition is a strong strategic fit.
“ACL and AEP River Operations are highly complementary businesses that share the same business practices and commitment to safety and customer service,” said Knoy. “I know the fleet, the operations, the people and the culture on both sides and I can’t think of a better fit. We are excited to join together and create something special.”
Knoy said that highly complementary networks and traffic patterns between the two companies create significant synergy opportunities.
“There is a great deal of value to be gained through increased fleet velocity and tow density, as well as in purchasing, port services and a more efficient cost structure,” said Knoy. “I’m highly confident in our ability to integrate the businesses and realize those benefits.”
Paul Tobin, ACL’s Chief Operating Officer, and Robert Blocker, ACL’s head of sales and customer service, also spent 10 years at AEP River Operations before joining ACL in 2011 along with Knoy. All three were previously at MEMCO Barge Line, which was purchased by AEP in 2001.
“This is a unique opportunity to bring together two world class organizations under a leadership team that knows the businesses first-hand and ran both very successfully over an extended period of time,” said Platinum Equity Partner Louis Samson. “We have tremendous confidence in Mark and his team’s ability to effect a seamless integration and quickly create substantial value.”
Samson added that the combination is also a great strategic move for ACL going forward.
“By acquiring AEP River Operations, ACL will enhance its already diversified commodity exposure, expand its customer base, and broaden the geographies it serves,” said Samson. “Today, ACL is one of the most diversified transportation companies in the United States. This combination will add scale and better position ACL to capture growth across all of its end markets.”
The transaction is expected to close in the fourth quarter of 2015, subject to regulatory approval and certain closing conditions.
Bank of America Merrill Lynch is advising ACL and will lead the transaction financing. Latham & Watkins is serving as legal counsel to ACL.
American Commercial Lines Inc. is an integrated marine transportation service company owned by affiliates of Platinum Equity, LLC and operating in the United States Jones Act trades. The company is headquartered in Jeffersonville, IN, has approximately 2,700 employees and operates a fleet of approximately 125 towboats and 1,900 barges. For more information about American Commercial Lines Inc., visit www.aclines.com.
AMERICAN COMMERCIAL LINES INC.
Contact: Stephanie Smith