Cypress Energy Partners LP has acquired the remaining 49.9 percent interest in Tulsa Inspection Resources and its affiliates for approximately $52.6 million, according to Feb. 23 company statement. Cypress Energy Partners now owns 100 percent of the company, which includes Tulsa Inspection Resources LLC, Tulsa Inspection Resources – Nondestructive Examination LLC and Tulsa Inspection Resources Holdings LLC.
In a transaction called a “drop down,” Cypress Energy Partners acquired the remaining interest in Tulsa Inspection Resources from an affiliate of Cypress Energy Holdings LLC and other unnamed beneficial owners of the holding company.
The drop down allows Cypress Energy Partners to offset declines expected in the company’s water and environmental services division, according to chairman, president and CEO Peter C. Boylan III. The transaction also provides the company with additional flexibility in 2015, he added, noting that Tulsa Inspection Resources had a solid 2014 and early indications looked promising for 2015, given the regulatory requirements and long lead time nature of new projects.
“Although the current energy market environment continues to be volatile, we continue to evaluate a number of interesting acquisition opportunities while remaining very disciplined,” Boylan said. “We believe our methodical and thoughtful approach to potential acquisition opportunities served us well relative to others. We remain focused on building a great company that will create long term value and distributable cash flow growth for our unit holders. We believe that the market disruption as a result of lower commodity prices will create some attractive opportunities for us in 2015 and beyond.”
Cypress Energy Partners officials have been discussing the purchase of the remaining 49.9 percent of Tulsa Inspection Resources for the last year, and the deal was recently approved by the company’s conflicts committee and board of directors. The conflicts committee, which is comprised entirely of independent directors, retained independent legal advisers to assist it in evaluating and negotiating the transaction.Tags: Cypress Energy Partners, mergers and acquisitions, Tulsa Inspection Resources