First Reserve and Fortress Investment-managed funds are acquiring a majority stake in Hawaiian fuel logistics and infrastructure firm Island Energy Services (IES) from owner One Rock Capital Partners for an unspecified sum.
One Rock will retain a minority stake in IES, which operates a fully integrated refined product import, storage and distribution infrastructure network.
IES manages fuel import and distribution assets that serve major airlines, utilities, retailers and government customers throughout Hawaii. The company’s assets include over 5.7m barrels of storage capacity and 57 miles of pipeline infrastructure. IES also operates a network of 50 Texaco service stations and convenience stores.
Gary Reaves and Neil Wizel, managing partners at First Reserve, said: “This transaction represents a compelling opportunity to leverage First Reserve’s long track record and expertise successfully investing in value-added infrastructure businesses. We believe that existing domestic distribution businesses and logistics infrastructure, including refined product storage and terminal assets, will continue to play a meaningful role in meeting the energy demands of the US economy.
“The company serves as an integrated partner for the import, storage and distribution of the refined products that help power Hawaii’s economy. Through our decades of experience and relationships, we intend to support management in driving long-term growth and enhanced utilisation of this important infrastructure network.”
Paul Steen, managing director at First Reserve, said: “We look forward to executing on a shared vision for value creation with IES management, including supporting Hawaii’s transition to biofuels while continuing to be a world-class partner to a growing base of government, commercial and retail customers across Hawaii.”
Drew McKnight, co-CEO and managing partner of Fortress Investment, said: “IES’s energy infrastructure is of high strategic and economic value for Hawaii and its communities.
“By working with the IES and First Reserve teams, we look forward to helping the company accelerate expansion of its renewable-fuel capabilities that will position the company at the forefront of Hawaii’s energy transition.”
Jon Mauer, president and CEO of IES, said: “We look forward to this new growth chapter and working with First Reserve and Fortress to build on the momentum across our business as we continue to meet the energy needs of our island communities.
“The network, services and resources our organisation provides have never been more important to Hawaii than they are today.”
To read the latest IPE Real Assets magazine click here.
