Exhibit 99.1
MARTIN MIDSTREAM PARTNERS
SIGNS AGREEMENT TO ACQUIRE
TESORO MARINE SERVICES BUSINESS
KILGORE, Texas, October 28, 2003 /PRNewswire-FirstCall via COMTEX/ --
Martin Midstream Partners L.P. ("MMLP") (Nasdaq: MMLP), today announced it has
signed a definitive agreement with Tesoro Marine Services LLC ("Tesoro"), a
subsidiary of Tesoro Petroleum Corporation (NYSE: TSO), for the purchase of
certain assets associated with Tesoro's shore based marine activities for $25
million plus the value of Tesoro's lube oil inventories, estimated to be $1.5
million. The assets to be acquired by MMLP include marine transportation assets,
terminalling and storage tank assets, and associated real estate along the Gulf
Coast. Included in this acquisition are Tesoro's lube oil sales and distribution
business. These assets are located at 14 terminals along the Gulf Coast from
Venice, Louisiana to Corpus Christi, Texas. Acquisition financing will be
provided through an expansion of MMLP's existing credit facility. The
transaction, which is subject to standard closing conditions as well as the
closing of the Midstream Fuel agreement referenced in the next paragraph, is
expected to close before December 31, 2003.
In a parallel transaction, Midstream Fuel Services LLC, signed a
definitive agreement with Tesoro for the purchase of Tesoro's fuel oil
distribution business for $2 million plus the value of Tesoro's diesel fuel
inventories, estimated to be $3.5 million. Midstream Fuel Services LLC is a
subsidiary of privately held Martin Resource Management Corporation ("MRMC"),
the owner of MMLP's general partner. MRMC is acquiring these assets from Tesoro
because fuel oil distribution generates non-qualifying income under Internal
Revenue Service regulations applicable to master limited partnerships such as
MMLP. However, following the closings, pursuant to contractual arrangements
between MRMC and Martin Midstream Partners, MMLP will utilize its midstream
assets to provide transportation and storage services for the fuel oil
distribution business which is being acquired by MRMC. Closing of the Midstream
Fuel purchase, which is subject to standard closing conditions as well as the
closing of the Martin Midstream Partners agreement referenced in the prior
paragraph, is also expected before December 31, 2003.
"Martin Midstream Partners' acquisition of Tesoro's marine
transportation, terminalling and lube oil distribution business further
strengthens our hydrocarbon products and by-products distribution business and
infrastructure in our core Gulf Coast market. Post acquisition, we believe we
will be one of the largest shore based service providers and lube oil
distributors in the Gulf Coast region" said Ruben Martin, President and Chief
Executive Officer of Martin Midstream GP LLC, MMLP's General Partner. Mr. Martin
continued, "We are very pleased to announce this first major acquisition
following our initial public offering and we believe the acquired business will
complement our current marine transportation, terminalling, and distribution
operations in the Gulf Coast and will be financially accretive to MMLP".
Martin Midstream Partners will provide additional information about the
proposed acquisition at its regular teleconference in connection with its
announcement of third quarter results, anticipated to be held on or about
November 10, 2003.
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About Martin Midstream Partners
Martin Midstream Partners provides marine transportation, terminalling,
distribution and midstream logistical services for producers and suppliers of
hydrocarbon products and by-products, specialty chemicals and other liquids. The
Company also manufactures and markets sulfur-based fertilizers and related
products and owns an unconsolidated non-controlling 49.5% limited partnership
interest in CF Martin Sulphur L.P., which operates a sulfur storage and
transportation business. MMLP operates primarily in the Gulf Coast region of the
United States.
Additional information concerning the Company is available via the
worldwide web at http://www.martinmidstream.com.
Forward Looking Statements
Statements about Martin Midstream Partners' outlook and all other
statements in this release other than historical facts are forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements and all references to financial estimates
rely on a number of assumptions concerning future events and are subject to a
number of uncertainties and other factors, many of which are outside its control
that could cause actual results to differ materially from such statements. While
MMLP believes that the assumptions concerning future events are reasonable, it
cautions that there are inherent difficulties in anticipating or predicting
certain important factors. These factors include, but are not limited to: the
ability to complete the pending acquisition; adverse weather conditions;
reliance on its interest in CF Martin Sulphur L.P.; the incurrence of material
liabilities that are not fully covered by insurance; the price volatility and
the supply availability of hydrocarbon products and by-products; restrictions in
its debt agreements; the prospects for future acquisitions and its ability to
make future acquisitions; the performance of recently acquired businesses; the
seasonality of its business; the competition in the industry; changes in
regulations on the federal, state and local level that are applicable to its
business; the cost of attracting and retaining highly skilled personnel; the
loss of significant commercial relationships with Martin Resource Management
Corporation; interruption in operations at its facilities; federal regulations
applicable to its marine vessels and regulations effecting the domestic tank
vessel industry; cost reimbursements it is required to pay to Martin Resource
Management Corporation; conflicts of interest and competition with Martin
Resource Management Corporation; the decisions made by and the control of its
general partner; and a decision by the IRS to treat MMLP as a corporation. A
discussion of these factors, including risks and uncertainties, is set forth
from time to time in the Company's filings with the Securities and Exchange
Commission. Martin Midstream Partners L.P. disclaims any intention or obligation
to revise any forward-looking statements, including financial estimates, whether
as a result of new information, future event, or otherwise.
Contact: Robert D. Bondurant, Executive Vice President and Chief Financial
Officer of Martin Midstream GP LLC (903) 983-6200
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