Alter Barge Line Inc. is selling its fleet of 387 barges and six towboats to Cargill Inc.’s Cargo Carriers and Marquette Transportation Co. in a deal unlikely to seriously alter the competitive landscape.
The transaction, expected to close by Sept. 30, also includes Alter’s Blackhawk Fleet in Buffalo, Iowa, and Azalea Fleet in New Orleans. Terms were not disclosed.
Alter’s owners got an offer “they thought was too good to pass up,” said Larry Daily, president of the Bettendorf, Iowa, company founded in 1960 by Bernie Goldstein with one boat and four barges. Goldstein died in 2009.
From Cargill’s perspective, “It’s a good fit with our barge business, which has been in existence for 50 years,” said Mark Klein, spokesman for the Wayzata, Minn.-based agricultural giant that operates about 940 barges. “The barge business is an integral part of our overall transportation efforts.” The purchase gives Cargill an opportunity to serve existing and new customers, he said.
Officials for Marquette, Paducah, Ky., which will be getting Alter’s six towboats, could not be reached. Marquette’s website says it has 50+ linehaul vessels.
Alter, which employs 130, will retain its terminals, grain elevators and scrap business and is considering starting a logistics business, Daily said.
Asked if they’ve been widely courted, he said, “There’s always somebody rumored to be looking to buy us, but this is the first time it was true,” Daily said.
The industry’s “been in the long, slow process of consolidation,” said Brent Dibner, president of Dibner Maritime Associates, Chestnut Hill, Mass., an industry analyst.
“Essentially what we have is a gradual process of really trying to achieve scale. Carriers with fewer than 1,500 barges are at a severe disadvantage. The move makes sense.”
Cargill’s addition of nearly 400 barges “will have no effect on rates or competition that will be discernible,” Dibner said. “The industry has major blocks of rivalry.” Among them: AEP River Operations, AmericanCommercial Lines and Ingram Barge Co.