ARKO Asks TravelCenters of America to Reconsider Offer

GPM Investments LLC's parent company made an unsolicited $92-per-share bid for TA.
TA travel center in Seymour, Ind.

WESTLAKE, Ohio — The unnamed bidder for TravelCenters of America Inc. (TA) has been identified: ARKO Corp.

The Richmond, Va.-based parent company of GPM Investments LLC submitted a $92-per-share acquisition proposal to TA on March 14 and requested access to diligence materials. The bid came one month after BP and TA reached a $1.3 billion deal that called for BP to pay roughly $86 per share in cash.

TA revealed the unsolicited offer from "Party G" in a proxy filing with the U.S. Securities and Exchange Commission. On March 22, TA's independent board members determined that the new proposal didn't constitute a superior proposal to the BP deal. The board members said the offer would require "significant" third-party financing and there was no firm commitment from a potential financing source to provide such financing and the financing markets "remain uncertain."

Now, ARKO is asking TA's board to seriously consider the proposal and engage with, rather than exclude, ARKO in the sale process. In a release on Monday morning, March 27, ARKO said it believes the board's decision regarding its proposal was incorrect and not in the best interests of TA's stockholders.

"ARKO's proposal is superior to BP's offer of $86 a share, and engaging with ARKO is obviously beneficial for [TA's] stockholders. ARKO's proposal represents a meaningful premium of $6 per share to the value of BP's offer, adding nearly $100 million in additional value to TravelCenters' stockholders," the company said in the release. "The proposal maintains the discipline that ARKO's stockholders are accustomed to, and that is characteristic of ARKO's systematic growth strategy designed to increase cash flow and profitability."

The company added it "is prepared to immediately commence confirmatory due diligence and quickly enter into an agreement and plan of merger along with the other ancillary arrangements on the same material terms as in the merger agreement with BP. As one of the most acquisitive operators of convenience stores in the United States, with 23 transactions completed since 2013 and one pending and expected to close in the second quarter of 2023, ARKO has never required any financing conditions and has closed every acquisition it has put under contract. ARKO's proposal to [TA] offers no financing-related conditions."

ARKO Corp. owns 100 percent of GPM Investments and is one of the largest operators of convenience stores and wholesalers of fuel in the United States. It operates in four reportable segments: retail, which includes convenience stores selling merchandise and fuel products to retail customers; wholesale, which supplies fuel to independent dealers and consignment agents; fleet fueling, which includes the operation of proprietary and third-party cardlock locations, and issuance of proprietary fuel cards that provide customers access to a nationwide network of fueling sites; and GPM Petroleum, which sells and supplies fuel to our retail and wholesale sites and charges a fixed fee, primarily to its fleet fueling sites.

Westlake-based TravelCenters of America Inc. is the nation's largest publicly traded full-service travel center network. Founded in 1972, its more than 18,000 team members serve guests in 281 locations in 44 states, principally under the TA, Petro Stopping Centers and TA Express brands. Offerings include diesel and gasoline fuel, truck maintenance and repair, full-service and quick-service restaurants, travel stores, car and truck parking, and other services dedicated to providing great experiences for its guests.

TA is committed to sustainability, with its specialized business unit, eTA, focused on sustainable energy options for professional drivers and motorists.

The operator has more than 600 full-service and quick-service restaurants and nine proprietary brands.