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06/15/2022

FTC Orders GPM to Return Five Stores to Corrigan Oil Co.

The decision comes one year after GPM took ownership of the Express Stop chain.
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Arko Family of Community Brands logo and GPM logo

RICHMOND, Va. — The Federal Trade Commission (FTC) directed GPM Investments LLC to amend its acquisition agreement for Express Stop convenience stores.

As part of the FTC's decision, GPM and its parent company ARKO Corp. are required to give five c-stores/gas stations back to Corrigan Oil Co. in several local Michigan markets. The swap must be completed by June 28.

The order comes 13 months after GPM took ownership of the 60-store chain as part of its deal with Corrigan.

"As part of their $94-million acquisition of Corrigan assets, ARKO and GPM insisted on a sweeping agreement not to compete covering more than 190 GPM locations in Michigan and Ohio, many of which are completely unrelated to the transaction," said Holly Vedova, director of the Bureau of Competition. "By keeping Corrigan from competing to sell gasoline and diesel to consumers in these markets, the agreement not to compete harmed customers who otherwise could benefit from this competition."

Richmond-based GPM operates or supplies fuel and convenience stores in 33 states and Washington, D.C. Corrigan is a Michigan-based family-owned business that supplies wholesale and retail fuel to convenience stores. 

The complaint alleges that as originally proposed, the agreement not to compete that ARKO and GPM required Corrigan to sign as part of the acquisition harmed customers in local retail gasoline and retail diesel fuel markets throughout Michigan and Ohio.

Corrigan was required not to compete not only in the 60 local markets where ARKO and GPM acquired Express Stop stores, but also in many other markets, according to the FTC.

The complaint also alleges that, even in those 60 markets, the noncompete agreement was unreasonably overbroad in geographic scope and longer than reasonably necessary to protect a legitimate business interest.

According to the complaint, the acquisition also harmed competition in five local Michigan markets for the retail sale of gasoline and, in one of those markets, for sale of diesel fuel. In each market — including two in Saginaw, and one each in Chesaning, Mt. Morris and Mason — the acquisition reduced the independent market participants to two or fewer.

The proposed order settling the FTC's complaint against ARKO and GPM requires them to:

  • Amend the agreement not to compete to only apply to the retail fuel businesses acquired by GPM, excluding the five locations to be returned to Corrigan;
  • Limit the terms of the agreement not to compete in these markets to no broader than three years in duration and no more than three miles from each Express Stop location;
  • Obtain prior approval from the commission before acquiring retail fuel assets within a three-mile driving distance of any of the returned locations for 10 years;
  • Not enter into, or enforce, any agreement not to compete related to acquisitions of a retail business that restricts competition solely around a retail fuel business already owned or operated by GPM; and
  • Notify third parties subject to similar agreements not to compete of GPM's obligations under the order.