SemGroup Corp. (NYSE: SEMG) is kicking off 2018 with an agreement to divest one of its noncore legacy assets as the Tulsa, Okla.-based company works to enhance its balance sheet.

On Jan. 8, SemGroup said it had reached an agreement to sell its asphalt business, SemMaterials México, to Ergon Asfaltos México HC LLC for an estimated $70 million including a reimbursement of roughly $15 million of net working capital, subject to customary post-closing adjustments.

SemGroup intends to use proceeds from the sale toward its capital raise plan associated with the $2.1 billion acquisition of Houston Fuel Oil Terminal Co. (HFOTCO) and to pre-fund capital growth projects.

“Divesting these noncore legacy assets is an important step as we raise capital and clearly define our portfolio of uniquely-advantaged midstream services on the Gulf Coast, Midcontinent and in Canada,” Carlin Conner, SemGroup's president and CEO, said in a statement. “As we enter 2018, we remain focused on executing our strategic plan, enhancing our balance sheet and paying the second HFOTCO payment.”

SemMaterials México provides asphalt products, technology and pavement services to the Mexico paving market. The business includes 14 in-country terminals and two national laboratories. It is the largest supplier of liquid asphalt cement products and product application services in the country and has a presence in every Mexican territory.

SemGroup said it expects to close the SemMaterials México sale early second-quarter 2018, subject to the receipt of certain governmental approvals and the satisfaction of other customary closing conditions.