Situation
EnergyUnited Electric Membership Corporation (“EMC”) decided it was time to explore strategic alternatives for its wholly-owned propane distribution subsidiary, EnergyUnited Propane, LLC (“EUP”).  Both EMC and EUP are headquartered in Statesville, North Carolina.

EMC serves ~110,000 electric members in central and western North Carolina, making it the second largest supplier of residential electricity in North Carolina.

EUP is one of the largest propane retailers in its region, serving ~29,000 residential and commercial customers throughout 104 counties in North Carolina, South Carolina, and Virginia.

In 2000, EMC founded EnergyUnited Propane, LLC through the acquisition of All Star Gas’s North Carolina markets (Durham, Warrenton, Creedmoor, Carthage, Denver, Gastonia, and Hendersonville), as well as the development of greenfield sites in Lexington, Taylorsville, and Madison, North Carolina.  EUP acquired the South Carolina markets of All Star Gas (Aiken and Barnwell) in 2001, and Albemarle Propane, based in Camden, NC in 2007.  In 2013, EUP purchased Lake Norman Propane.

Objective
Matrix was retained to customize, execute, and complete a confidential sale process that would allow EMC to realize maximum after-tax value upon the divestment of EUP and redeploy capital into its core, electricity business.

Solution
Matrix provided merger and acquisition advisory services to EMC and EUP, which included valuation advisory, marketing of EUP through a confidential, structured sale process, and negotiation of the transaction.

Multiple competitive offers were received for EUP, and ThompsonGas, LLC was selected as the acquirer.

Matrix assisted in the negotiation of the purchase agreement and coordinated the due diligence and closing process.

The transaction with ThompsonGas closed in September 2020.  Post-closing,  EMC and ThompsonGas will maintain a coordinated customer marketing effort within EMC’s electric footprint in central and western North Carolina.