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HONOLULU - Isle Gas, a subsidiary of AMF Hawaiʻi Investment Holdings managed by Argo Infrastructure Partners, announced Tuesday it has reached an agreement to purchase select non-utility gas storage and delivery assets from AmeriGas Propane, a UGI Corporation (NYSE: UGI) subsidiary. UGI, currently trading near its 52-week high with a market capitalization of $7.8 billion, has demonstrated strong financial performance with a healthy 4.1% dividend yield and an impressive 32-year streak of dividend increases, according to InvestingPro data.
The acquisition includes approximately 750,000 gallons of propane storage across multiple sites and a delivery fleet serving thousands of residential and commercial customers in Oʻahu, Hawaiʻi Island, Maui, and Kauaʻi.
Isle Gas will be serviced by Hawaiʻi Gas, which currently supplies nearly 34,000 non-utility propane customers across Hawaii. Both companies are wholly owned by funds managed by Argo Infrastructure Partners.
"The addition of these assets will complement our existing Hawaiʻi operations," said Jason Zibarras, Managing Partner and Founder of Argo Infrastructure Partners, in a press release statement.
Alicia Moy, President of AMF and President and CEO of Hawaiʻi Gas, stated that Hawaiʻi Gas is "committed to making this a smooth transition process for AmeriGas customers as they transition to Isle Gas."
The transaction is expected to be completed in the third quarter of 2025.
Argo Infrastructure Partners currently manages over $6.25 billion in assets on behalf of its investor partners, according to the company’s press release. HawaiÊ»i Gas, established in 1904, is the only government-franchised, full-service gas company manufacturing and distributing gas in HawaiÊ»i.
In other recent news, UGI Corporation reported strong financial results for the second quarter of fiscal 2025, with earnings per share (EPS) of $2.21, surpassing analyst expectations of $1.96. Despite a revenue shortfall, the company’s strategic initiatives have led to increased guidance for fiscal 2025, with EPS now projected between $3.00 and $3.15. The company’s revenue for the quarter was $2.67 billion, which fell short of the forecasted $3.26 billion. Additionally, AmeriGas, a wholly-owned subsidiary of UGI, announced the sale of its Hawaii operations to Isle Gas, a move aimed at reducing company debt and focusing on markets with better operational prospects. The transaction is expected to close in the fourth quarter of fiscal 2025. Meanwhile, UGI has been working on operational improvements at AmeriGas, which have already contributed to a reduction in customer attrition levels. AmeriGas has also seen a significant improvement in its financial health, with a reduction in its net debt to EBITDA ratio. Analyst feedback from firms like Jefferies has highlighted the company’s potential for robust growth, particularly in its natural gas business.
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