Downeast Energy, one of Maine’s largest oil dealers, was sold to an Oklahoma company Monday, ending three generations of ownership by a Brunswick family that’s known as much for its community involvement as its business.
NGL Energy Partners LP agreed to acquire the Maine and New Hampshire offices of Brunswick-based Downeast, which has been owned by the Morrell family for more than 80 years, for a combination of cash and partial ownership in NGL.
The company, originally named Brunswick Coal, began selling coal and firewood in 1908.
Allen Morrell bought the company in 1931 and expanded into heating oil, propane and building materials. Downeast now has 300 employees and $140 million in annual revenue. It will keep its name and puffin logo, and the employees.
The Morrell family, which was under pressure to expand the company through acquisitions or sell it, said it sold Downeast with “mixed emotions.”
“My grandfather started the business 80 years ago. This is extremely hard,” said Vice President Bill Morrell. One 40-year veteran of the company cried when he told her about the sale, he said.
The deal follows the sale of another family-owned energy business in Maine this year. In January, Dead River Co. of Portland agreed to buy Bangor-based Webber Energy Fuels’ retail heating oil business. The oil industry has seen years of consolidation as the cost of oil has soared and the cost of natural gas has dropped.
The Morrell family will retain Downeast’s residential development business, said President John Peters. Peters, who has been with Downeast for 31 years, will remain president of the local operations under Tulsa-based NGL.
Downeast is the latest in a string of acquisitions during the past six months for NGL, which has 219,000 customers in 21 states.
It has bought seven retail propane companies affiliated with Pacer Propane Holdings, certain assets of North American Propane, and most of the natural gas liquids business of SemStream LP.
The company’s stock, traded on the New York Stock Exchange, closed down slightly Monday at $21.65 per share.
Peters said Downeast had been approached over the years by several suitors, including rivals and private equity firms.
NGL’s offer seemed attractive, in part, because the company was relatively new to the region and would keep Downeast employees in their jobs, Peters said.
For a company whose motto is “Feel Good Inside,” the future of the employees was a pivotal part of the deal.
“Had it been another acquirer, they could have been forced into reducing staff to make it viable for them. NGL was able to keep everyone,” Morrell said.
It was important to the family that the employees keep their jobs with similar salaries and benefits, and that customers continue to be served by the same workers, Peters said.
The family addressed customers directly on its Facebook page, announcing the news with a letter that read: “We want to thank you for all the years we’ve been able to be of service and to assure you that you will remain in excellent hands.”
The timing of the sale worked for the Morrell family, Peters said, because “the shareholders were reaching points in their lives where they needed to make decisions about their future” and Downeast lacked a fourth generation with interest in leading the company.
“We were faced with the challenge of the business not having grown in the last couple of years,” Morrell said. “You have to grow to survive to keep folks interested in the business.
“Given the family members’ ages, we weren’t ready to reinvest by acquiring other companies to grow the business.”
Morrell said the family, which was unanimous about the sale, wasn’t afraid of any backlash over selling Downeast to an Oklahoma company.
Restrictions about the amount of market share controlled by one company would likely have made it difficult for a Maine-based rival to buy Downeast.
“For the employees, this is a great solution,” said Jamie Py, president of the Maine Energy Marketers Association. “If you’re going to have a sale and you can protect the best interest of the customers and the employees, it’s a positive all around.”
In the Brunswick area, the Morrell family name is associated with more than oil.
The three generations who led Downeast are particularly active in supporting Mid Coast Health Services.
“All of us have grown up in Brunswick, been active in the community. I don’t see that changing,” Morrell said.
Family members have volunteered time and donated money to Mid Coast Health Services. They also have been active in United Way, and they helped establish the Maine State Music Theatre in Brunswick.
“The Brunswick community as a whole has really benefited from the generosity and leadership of the Morrell family over the years. They are a key to what makes Brunswick a great place to live and work,” said Mid Coast Health Services President and Chief Executive Lois Skillings.
Dick Morrell, the 83-year-old patriarch and figurehead of the company, was chairman of the board for Mid Coast Health Services for 25 years and remains chairman emeritus.
The board room at Mid Coast Hospital is named in his honor, and the hospital’s library is named in honor of the Morrells.
Dick Morrell will maintain an office at Downeast to oversee his personal affairs. He will not receive a salary.
“It’s not an operational role,” said Bill Morrell.
“He’s just someone who loves coming into the office every day. Employees like seeing him in the office.
“Part of the deal was that he keep his office — he can stay,” Morrell said.
Staff Writer Jessica Hall can be contacted at 791-6316 or at: [email protected]