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Casey's Buys 10 Holiday Stationstores

ANKENY, Iowa -- Casey's General Stores, operator of 1,500 convenience stores based here, signed agreements to acquire 10 Holiday Stationstore c-store locations in Nebraska and Iowa.

"The 10 stores are in communities that we currently operate in or are in surrounding communities where we operate," Bill Walljasper, senior vice president and CFO of Casey's, told CSNews Online. "We believe this is a very good tuck-in acquisition."

Of the 10 convenience stores, six are located in Nebraska and four are located in Iowa. According to Walljasper, this purchase marks the exit of the Holiday chain from these two states. "It looks like they wanted to peel off those [stores], and we were glad for the opportunity," he said, noting conversations with Holiday Stationstores began roughly six moths ago.

Holiday operates more than 300 convenience stores and more than 100 franchise locations across its 12-state operating region, according to its Web site.

Casey's plans to finalize the deal April 19, and subsequently will rebrand the stores to the Casey's banner, Walljasper told CSNews Online. While a timetable has not been established for other changes, he said the chain's prepared food offering will be installed on some of the locations.

Casey's General continually looks for acquisition and new build opportunities throughout its nine-state marketing region, as well as adjacent states.

"Acquisitions are part of our strategic initiatives going forward," said Walljasper, declining to elaborate on any specific deals. "We always have things in the pipeline."

Meanwhile, Walljasper also shared his thoughts on Alimentation Couche-Tard's $36-per-share bid to buy Casey's General, which was revealed Friday when the Canadian c-store operator made the offer public. Casey's General soon after rejected the offer, calling it "significantly undervalued."

"We have reached out to several shareholders, and based on those conversations as well as with the market -- which saw our stock price rise to the $39 range -- and they have the same sentiment that $36 price was significantly below the value of Casey's."

He also explained that when Casey's was approached with the offer March 9, the chain did deliberate with senior management and financial advisor in terms of its strategic plan going forward.

"We take our fiduciary responsibilities very seriously. We do have a track record of providing shareholder value, and it provides more than the $36 offer," said Walljasper. "And for future offers that come, we'll do our due diligence."

Walljaper pointed to the chain's 24 consecutive quarters of same-store sales growth and its average in-store margins of 41 percent as evidence of its long-term value.

"Certainly we believe we have strong prepared food operations, and the initiatives we have going forward will roll that up, and we can add continued shareholder value."

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