Situation
Freeman Gas and Electric Co., Inc. (“Freeman,” “Freeman Gas,” or the “Company”) was founded in 1936 in Spartanburg, South Carolina. Originally a modest, single-location appliance dealership, Freeman grew to be one of the nation’s premier full-service propane retailers under the leadership of third-generation operator J.R. “Rob” Freeman III.

The Company, known for its full-service offerings ranging from retail propane sales, service, and installation to a full line of propane appliances, operated 23 showroom locations throughout North & South Carolina, Georgia, and Tennessee. With logistical support from its 38 bulk plant locations, Freeman served a diverse customer mix in this geography comprised of ~67,000 residential, commercial, agricultural, and forklift accounts in 86 counties.

Matrix was retained to perform a valuation of the Company and to advise on a possible sale process. Rob Freeman and the Company’s shareholders elected to exit the industry and diversify the family’s wealth.

Objective
To customize, execute, and complete a confidential sale process that would allow the Company’s shareholders to realize maximum after-tax value upon the sale of Freeman Gas, while also retaining certain key real estate assets and initiating a lease relationship with the buyer.

Solution
Matrix provided merger and acquisition advisory services to Freeman, which included valuation advisory, marketing of the business through a confidential, structured sale process, and negotiation of the transaction. The sale process included a buyer pool of privately owned, regional and national propane marketers; and large, public companies including MLPs.

Multiple competitive offers were received, and Superior Plus Energy Services, Inc. (“Superior”) (TSX: SPB) was ultimately selected as the acquirer.

Matrix assisted in the negotiation of the asset purchase agreement, coordination of the due diligence process, and structuring the post-closing lease agreements between Freeman and Superior.

The transaction with Superior closed in June 2021.