LAVAL, Quebec — Alimentation Couche-Tard Inc. is making good on its goal to grow.
On March 16, the Canada-based retailer entered into exclusive negotiations to acquire 100 percent of TotalEnergies SE's retail assets in Germany and the Netherlands, as well as a 60 percent controlling interest in the company's Belgium and Luxembourg entities.
The proposed acquisition would include 2,193 sites: 1,195 in Germany, 566 in Belgium, 387 in Netherlands and 45 in Luxembourg. "These are high-quality locations with very strong market positions in each country and in close proximity to our current footprint in Europe," Couche-Tard President and CEO Brian Hannasch said during the company's earnings call for its fiscal 2023 third quarter, held March 16.
The convenience retailer's next step is to enter into a consultation process involving employee representative bodies in the four countries outlined, along with seeking approval of the relevant competition authorities.
The proposed transaction is expected to close before the end of calendar year 2023.
"For some time, we've been seeking a sizable acquisition. This one will grow our European network by close to 80 percent, bringing value to our shareholders and being a strong geographic and strategic fit," Hannasch said. "We're truly excited to bring these assets from TotalEnergy into the Couche-Tard family — having a deep respect for the operations, management and employees in the four countries involved, as well as a great confidence of the benefit of having them join forces with our leading global retail operations."
By growing into Germany, Europe's largest market, and other markets near Couche-Tard's Scandinavian, Irish, Polish and Baltic networks, "we believe it can generate material synergies and create additional growth opportunities in some of Europe's strongest economies," he added.
While describing the addition of TotalEnergies' assets as "game-changing growth for our network," Hannasch also highlighted Couche-Tard's other recent moves around network growth, namely its True Blue Car Wash and Big Red Stores acquisitions.
Couche-Tard acquired True Blue Car Wash, which currently has 65 express tunnel car wash sites under the brands Clean Freak and Rainstorm. These sites are located in the company's core markets — in high-traffic areas in Arizona, Texas, Illinois and Indiana — with a strong pipeline of future new industry sites planned and under development.
"We see this acquisition as a natural extension of our current car wash business of more than 2,500 locations and a part of our commitment to lead and innovate in a fast-growing segment that meets our customers' mobility needs," Hannasch said.
The acquisition closed on Feb. 8 and settled for $395.9 million.
"Adding True Blue's high-quality car wash sites has already presented compelling opportunities for cross promotion and loyalty building, which began immediately under close and 32 days after close, we're very pleased with the early results," he reported.
Couche-Tard also inked an agreement to acquire 45 fuel and convenience retail sites from Big Red Stores, based in Bryant, Ark. According to the chief executive, these are high-quality, well-located sites across Arkansas that align with the retailer's growth ambitions in that area.
"As they are predominantly large-format sites, we will have ample space to enhance our fresh food programs and product assortment and services in these sites," he noted.
The transaction is expected to close during the first half of calendar year 2023.
Laval-based Alimentation Couche-Tard is known globally for its Couche-Tard and Circle K banners. It operates in 24 countries and territories with more than 14,300 stores, of which approximately 10,900 offer road transportation fuel.