Kirby Corporation (NYSE:KEX) announced that it has signed an agreement to purchase United Holdings LLC ("United"), a distributor and service provider of engine and transmission related products for the oil and gas services, power generation and transportation industries, and manufacturer of oilfield service equipment. The base purchase price is $270 million in cash (before post-closing adjustments), plus a three-year earnout provision for up to an additional $50 million payable in 2014. United, headquartered in Oklahoma City, Oklahoma with 21 locations across 13 states, distributes and services equipment and parts for Allison Transmission, MTU Detroit Diesel Engines, Daimler Trucks NA, and other diesel and natural gas engines.
Kirby Corporation, through its subsidiaries, provides marine transportation and diesel engine services to the marine and power generation markets in the United States. The company operates in two segments, Marine Transportation and Diesel Engine Services.
Oil is the heartbeat of the world's economy and the world consumption of oil, spurred on by countries such as India and China, is set to increase tremendously.
Since the horse and carriage became obsolete because of the car, the main mean of transportation, oil has become vitally important to the world economy. Its importance has catapulted to the point that in a world suddenly without oil, all the minor and major delivery systems that allow economic undertakings on a larger than local basis wouldn't work and the world economy would collapse.
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