SPIs Maxum Strikes Again


Maxum Petroleum Inc., wholly-owned subsidiary of SPI Petroleum LLC, acquired lubricant and fuel distributor Petroleum Products Inc. and its affiliates for an undisclosed amount effective May 1, a move Maxum said will increase its growing presence in the energy sector and help extend its business reach closer to the eastern seaboard.

Headquartered in Charlestown, W. Va., Petroleum Products was founded in 1938 and supplies fuels, lubricants and related services – including Chevron, Mobil, Exxon and Conoco lubricants – to industrial and coal mining operations in the Central Appalachia region. Petroleum Products operates nine warehouse and bulk plant facilities, and services customers in West Virginia, eastern Kentucky, south central Ohio and southwestern Virginia. Its affiliates are Petroleum Transport Inc. and Petroleum Fueling Inc.

Were working to build, and well along the way to building, a national presence as an operating company to service the commercial and industrial fuel and lubricants market nationally, Mike McDonald, Maxum Petroleums senior vice president for mergers and acquisitions, told Lube Report. We already have a strong concentration in the energy industry through Simons Petroleum.

On the lubricants side, Petroleum Products supplies engine oils and greases, McDonald said, primarily for coal mining operations in West Virginia and Kentucky. He explained that the acquisition was both a natural extension of Maxums already strong presence in the energy sector by getting into coal mining operations in West Virginia, and a good geographical extension. This is our first real acquisition this far east of the Mississippi – we have an acquisition in Illinois as well, he said.

Greenwich, Ct.-based Maxum Petroleum is a wholly-owned subsidiary of Oklahoma City-based SPI Petroleum LLC, an acquisition vehicle formed in 2004 by three private equity firms – Northwest Capital Appreciation Inc., Waud Capital LLC and RBC Capital Partners (through Cadent Energy Partners) with the goal of consolidating the commercial lubricant and fuel distribution industry.

SPI Petroleum then formed Maxum – previously named Global Petroleum Inc. – in 2006. Maxums purpose was to continue the consolidation of the commercial fuel and lubricant distribution industry begun by SPI Petroleum in 2004. Including the Petroleum Products acquisition, Maxum or its affiliates have acquired, over the last three years, eight lubricant and fuel marketers, including Simons Petroleum, Trevco, Hartney, Pecos (including its General Petroleum and Rainier Petroleum subsidiaries) and Canyon State Oil.

McDonald emphasized the acquisition will not impact the management at Petroleum Products, which will operate as a wholly-owned subsidiary of Maxum Petroleum. Traditionally, to date, all management members of all our companies have stayed on, he said. Pat Graney will continue to be president of the company and operate that, and they will continue to market under that name. Our goal is to bring them additional resources and capabilities. We dont anticipate any significant changes as to how they operate.

Pat Graney, president of Petroleum Products, said the company was excited about the possibilities that becoming part of a larger enterprise will provide. The scale of operations, services and financial backing of Maxum Petroleum will allow us to better serve both our customers and supply partners, and should present new challenges and opportunities for our employees and management team members, Graney said.

Related Topics

Market Topics