Approaching a Select Group of Strategic Buyers Resulted in Successful Divestiture
Industry: Fuel Transportation
Company Profile: Kem Oil Limited is a fuel trucking business that was founded in 1965.
The business has grown to cover the entire province of Ontario and has trucks operating
in every fuel terminal in the province. Known for its quality of service and safety record,
the Company transports fuel for several major national and regional companies, including
Canadian Tire Petroleum, Husky Oil, Pioneer Petroleum, Loblaws, Canadian National Railway
and Suncor Energy.
NewPoint’s Role: NewPoint was retained as exclusive financial advisor by the owner of
the Company to sell the business. Given Kem Oil’s niche market, a small group of strategic buyers
were approached. NewPoint played a full role which included management of the due diligence process
and assisting in the negotiation of all related closing documentation. A key value-add of NewPoint
was working with tax advisors to help structure the most tax effective way for the vendor to sell the
business.
Transaction Snapshot: As a result of approaching a select group of potential buyers, the business
was sold to a strategic entity. The buyer, RST Industries Limited, represented an ideal succession as
it had customers in common with the Company and is actively developing a material footprint in the fuel
transportation business.
