Information on the target
Vopak and First Reserve Corporation have successfully completed the acquisition of the Bahamas Oil Refining Company (BORCO) oil storage terminal located in Freeport, Bahamas. The equity value of the newly formed entity is estimated at $550 million, with ownership split between affiliates of First Reserve Fund XI, L.P. (80%) and Vopak (20%). This acquisition was partially financed through a senior secured credit facility that was fully underwritten by ABN AMRO Bank N.V. and DnB Nor Bank ASA, and has received all necessary regulatory approvals from the Government of the Bahamas. The specific terms of the transaction remain undisclosed.
The BORCO terminal, now to be renamed Vopak Terminal Bahamas, boasts a storage capacity of three million cubic meters (approximately 20 million barrels) with potential for expansion up to five million cubic meters. It specializes in the storage and handling of crude oil, fuel oil, and clean petroleum products, while also offering blending, transshipment, and bunkering services. Strategically located just 80 miles off the coast of Florida, it is the largest storage terminal in the Caribbean, equipped with deepwater jetties capable of accommodating the largest vessels.
Industry overview in the target’s specific country
The oil and gas industry in the Bahamas has been evolving, with the country positioning itself as a strategic hub for energy-related infrastructure in the Caribbean. The Bahamas benefits from its geographical proximity to the United States, making it an attractive location for oil storage and distribution. The government has been supportive of investments in this sector, recognizing the potential for economic growth and job creation that comes with developing energy infrastructure.
In recent years, the Bahamas has seen a growing interest from international investors looking to capitalize on its strategic location and favorable regulatory environment. The oil storage market is particularly significant, as it serves not only local demands but also caters to the larger U.S. market. This has led to increased competition among storage facilities, driving improvements in service offerings and operational efficiencies.
Furthermore, the Caribbean region is witnessing a surge in energy consumption, driven by economic development and population growth. As a result, the demand for reliable storage and distribution services is expected to rise, presenting opportunities for companies like Vopak and First Reserve to establish themselves as key players in the market. The acquisition of BORCO aligns with this trend, positioning the terminal as a vital asset for major oil companies seeking to enhance their supply chain capabilities in the region.
The rationale behind the deal The acquisition of BORCO by Vopak and First Reserve Corporation is part of a strategic initiative to develop energy-related infrastructure that fosters long-term growth opportunities. This partnership aims to leverage Vopak's extensive operational expertise and First Reserve's de…