American PetroLog co-founder: It was the ‘right time’ to sell the company
American PetroLog co-founder Jeff Colonna said it was the “right time” to sell the third-party logistics business during a recent “Hot Seat” interview with Spencer Tenney, CEO of the Tenney Group, which provided advisory services.
Once he identified the right buyer, the decision wasn’t difficult, he maintained.
Kenan Advantage Group’s (KAG’s) logistics division acquired the seven-year-old company based in Lafayette, Louisiana, in June, citing “tremendous synergies” between the organizations, and American PetroLog’s “impeccable” reputation.
“We knew pretty quickly that they were the right partner for us,” Colonna said. “The goal was to preserve the culture, growth, and service American PetroLog has provided.”
American PetroLog provides multi-modal distribution services to the petrochemical industry, including trucking, transloading, storage, and blending. It made Inc. Magazine’s list of the nation’s 5,000 fastest-growing private companies each of the last two years, reaching No. 544 in 2020 with three-year revenue growth of 849%. The company was busy expanding transloading services when Bulk Transporter checked in two years ago.
See also: American PetroLog solving problems with multi-modal approach
The sale to KAG Logistics wasn’t his first opportunity to exit the business, Colonna said, noting that American PetroLog’s rapid expansion attracted other parties interested in acquiring the company over the last couple years, but the timing wasn’t right, until now. “You need to be a certain size to get the true value for what you’ve done,” he said.
American PetroLog already was using an independent, third-party CPA to certify its financials prior to the transaction, so it “didn’t go to market and then try to recreate financials to justify a narrative,” he explained. With all its “ducks in a row,” the company was “overprepared,” which made the due-diligence process smoother.
Colonna also discussed how he selected a seller-focused, mergers-and-acquisitions advisor, other challenges he faced in conducting the transaction, how he broke the news to his equally invested family, and his future plans.
In announcing the deal earlier this summer, KAG said American PetroLog’s team of logistics professionals would join the company, and Colonna reiterated his continued involvement, saying his focus remains on building and growing his team, and strengthening the business and its services to customers.
“I want KAG Logistics to walk away from this thinking they stole the business because there’s so much upside,” he concluded. “I want this to be a win-win for both of us, so they get significant value for what they purchased, and we’re happy with the deal we agreed to.
“So my commitment to them is that I’m on board, and were going to continue this growth trajectory—and really blow this up.”
