Kirby Corporation Announces the Purchase of the Remaining 65% Interest in Offshore Partnership
March 02 2006 - 6:58PM
PR Newswire (US)
HOUSTON, March 2 /PRNewswire-FirstCall/ -- Kirby Corporation
(NYSE:KEX) ("Kirby") announced today that its wholly owned
subsidiary, Dixie Offshore Transportation Company, has purchased
from Progress Fuels Corporation ("PFC") the remaining 65% interest
in Dixie Fuels Limited ("Dixie Fuels"), a general partnership, for
$15.6 million in cash. Prior to the purchase, Dixie Fuels, formed
in 1977, was 65% owned by PFC and 35% owned by Kirby. The final
purchase price will be determined based on post-closing working
capital adjustments and drydocking expenditures. Dixie Fuels
operates a fleet of four offshore dry-bulk barge and tugboat units
operating under long-term contracts with Progress Energy Florida,
Inc. ("Progress"), an affiliate of PFC, and Holcim (US) Inc.
("Holcim"). Dixie Fuels primarily transports coal from the lower
Mississippi River to Progress' power generation facility at Crystal
River, Florida. Dixie Fuels' contract with Holcim is a backhaul of
limestone rock from Crystal River, Florida to Holcim's Theodore,
Alabama cement manufacturing plant. Financing of the acquisition
was through a combination of cash and borrowings from Kirby's
existing credit facility. Joe Pyne, Kirby's President and Chief
Executive Officer, commented, "Kirby subsidiaries have served as
the managing partner of Dixie Fuels since the partnership's
inception in 1977, accounting for our 35% interest under the equity
method of accounting. For the 2005 year, Dixie Fuels' revenues were
$26 million. The acquisition will not have a material impact on
Kirby's earnings in 2006 due to large scheduled maintenance
requirements." Kirby Corporation, based in Houston, Texas, operates
inland tank barges and towing vessels transporting petrochemicals,
black oil products, refined petroleum products and agricultural
chemicals throughout the United States' inland waterway system.
Kirby also operates four ocean-going barge and tug units
transporting dry-bulk commodities in United States coastwise trade.
Through the diesel engine services segment, Kirby provides
after-market service for large medium-speed and high-speed diesel
engines and reduction gears used in marine, power generation and
railroad applications. Statements contained in the press release
with respect to the future are forward-looking statements. These
statements reflect management's reasonable judgement with respect
to future events. Forward-looking statements involve risks and
uncertainties. Actual results could differ materially from those
anticipated as a result of various factors, including cyclical or
other downturns in demand, significant pricing competition,
unanticipated additions to industry capacity, changes in the Jones
Act or in U.S. maritime policy and practice, fuel costs, interest
rates, weather conditions, and the timing, magnitude and the number
of acquisitions made by Kirby. Forward-looking statements are based
on currently available information and Kirby assumes no obligation
to update any such statements. A list of additional risk factors
can be found in Kirby's annual report on Form 10-K for the year
ended December 31, 2004, filed with the Securities and Exchange
Commission. DATASOURCE: Kirby Corporation CONTACT: Steve Holcomb of
Kirby Corporation, +1-713-435-1135 Web site:
http://www.kirbycorp.com/
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