US terminal and pipeline operator NuStar Energy has agreed to sell its European assets to Inter Terminals for $270 million. The assets include six liquids storage terminals in the UK and one in the Netherlands with a combined storage capacity of 9.1 million barrels.

NuStar’s president and CEO Brad Barron said the decision to sell was difficult. He commented, however, that the company’s European assets are not synergistic with its other operations and that the divestment is a critical step in the implementation of a comprehensive plan launched earlier this year to position NuStar to successfully de-lever and deliver strong, sustainable distribution coverage for the future.

For Inter Pipeline, the Canadian parent of Inter Terminals, the deal is an “exciting step forward.” Its president and CEO, Christian Bale, said: “The acquisition materially increases our overall storage capacity and establishes Inter Terminals as the largest independent storage operator in the UK.  Furthermore, the transaction provides an attractive entry into the Port of Amsterdam.”

The NuStar Europe terminals operate as storage and blending hubs for the transshipment of refined products as well as the inland distribution of petroleum and petrochemical products.

In the UK, the 1.9 million barrel facility at Grays near London handles around 17 million barrels of refined products each year. The 49-tank terminal has operated at around 100% of capacity in the past three years.

The smaller terminals in the UK – at Belfast, Eastham, Grangemouth, Runcorn and Clydebank – primarily support the distribution of petrochemicals, gasoline, diesel and sulfur to regional centers.

In the Netherlands, a 3.8 million barrel terminal in Amsterdam provides gasoline, diesel and fuel oil storage and blending services. Like its Grays counterpart, this 44-tank facility has operated at around 100% of capacity in the past three years.

Overall, the addition of NuStar’s assets, comprising 321 tanks in total, increases Inter Terminal’s storage capacity by approximately 33% to 37 million barrels. The acquisition is expected to close in the fourth quarter, subject to the usual closing conditions.

Inter Pipeline is funding the acquisition with proceeds from new issued shares. The company anticipates that the offering, which is expected to close around Nov. 7, will have total gross proceeds of about $200 million.