NATIONAL REPORT — The convenience store industry has been consolidating for a number of years now, with small and mid-sized chains selling their stores to larger companies. In the past year or two, however, the industry has seen a sizeable increase in the number of companies exiting the business altogether, with some of these being larger chains.
“In the last 18 to 24 months, there has been a dramatic increase in acquisitions and companies selling their assets,” Dennis Ruben, executive managing director of Chicago-based NRC Realty & Capital Advisors LLC, told Convenience Store News.
He explained that master limited partnerships (MLPs), such as CST Brands/CrossAmerica, Global Partners and Energy Transfer Partners, have been very aggressive in growing their companies and can pay more because they are public, with tax advantages. Also, traditional larger companies such as 7-Eleven and Circle K, and even private equity firms, are in purchase mode.
This trend is certainly reflected in this year’s Convenience Store News Top 20 Growth Chains ranking, our fifth-annual rundown of the convenience store chains that added the most net new stores year over year. The 2016 ranking is based on stores added between January 2015 and January 2016.
Topping the list are such formidable industry acquirers as Circle K parent Alimentation Couche-Tard Inc. (in the No. 1 spot), Speedway parent Marathon Petroleum Corp. (No. 2) and 7-Eleven (No. 3).
In March 2015, Laval, Quebec-based Couche-Tard closed on its acquisition of The Pantry Inc. The deal included approximately 1,500 c-stores that the Cary, N.C.-based parent of Kangaroo Express owned throughout the Southeast. This one move propelled Couche-Tard to the No. 1 position.
This year’s listing also includes some industry acquirers that are newer to the acquisition game, but no less aggressive than long-time players. Such companies include United Pacific (at No. 4), GPM Investments LLC (No. 5) and TravelCenters of America (No. 6).
The CSNews Top 20 Growth Chains report is based on store count figures provided by TDLinx, a service of Nielsen. Wherever possible, the TDLinx numbers were confirmed by the companies. TDLinx defines a convenience store as a store that includes a broad merchandising mix, extended hours of operation and a minimum of 500 SKUs. Fueling stations with small kiosk stores do not meet the official definition of a c-store and thus are not reflected in TDLinx’s store count figures.
The full Top 20 Growth Chains list for 2016 is:
1. Alimentation Couche-Tard Inc.
2. Marathon Petroleum Corp.
3. 7-Eleven Inc.
4. United Pacific
5. GPM Investments LLC
6. TravelCenters of America LLC
7. Sunoco LP
8. Alliance Energy Corp.
9. CrossAmerica Partners LP
10. Casey’s General Stores Inc. (tie)
11. Wawa Inc. (tie)
12. Kwik Trip Inc.
13. Murphy USA Inc.
14. Sheetz Inc.
15. Love’s Travel Stops & Country Stores
16. Blarney Castle Oil Co.
17. Pilot Flying J
18. Tri Star Energy LLC
19. Jacksons Food Stores (tie)
20. QuikTrip Corp. (tie)
Overall, this year’s Top 20 Growth Chains added a net 3,159 stores to their portfolios between January 2015 and January 2016, equating to a 12.3-percent increase for the year. Not surprisingly, in view of the impressive increase in acquisitions lately, this represents 689 more stores than what last year’s Top 20 Growth Chains added (2,470 net stores).
For much more on this year’s Top 20 Growth Chains, including an interview with Couche-Tard President and CEO Brian Hannasch, look in the March issue of Convenience Store News.