CLOQUET, Minn. — Timing has led Best Oil Co. to put itself on the market, with a two-part sale expected to be finished by mid-month.
Mike McKinney, director of operations for Cloquet-based Best Oil and its Little Store chain, confirmed to the Duluth News Tribune that the retail end of the business will be sold to TravelCenters of America LLC (TA), also operating as TA and Petro stations. The Little Store chain has 20 locations in the region.
TA, which was expected to close on the deal Monday, did respond to requests for comment from CSNews Online.
According to McKinney, a handful of major national companies are currently in a "feeding frenzy" in regards to acquisitions.
"We have been working with consultants with an investment banking firm specializing in the petroleum industry for the past 10-15 years," he said. "They told us that right now is really a seller's market. With the interest rates as low as they are, we were told we could get maximum value in the next five years or so, but that window of opportunity isn't going to necessarily last forever."
Westlake, Ohio-based TA only has three existing locations in Minnesota — in Clearwater, Rogers and Albert Lea. Adding the Little Store chain will mark the company's first move into the northern Minnesota market, the news outlet reported.
The Little Store operation includes 20 gas stations and convenience stores, 18 of which are owned by the McKinney family and two of which are franchises. There are five in Duluth and three in Cloquet, with the others in Esko, Carlton, Barnum, Sturgeon Lake, Floodwood, Proctor, Superior, Hinckley, Moose Lake, Two Harbors, Grand Rapids and Iron River.
The sale of the wholesale portion of the business, Best Oil, is tentatively slated to close on March 18. McKinney said the buyer is a Minnesota company, but he did not disclose the name.
According to the report, most of the companies' 300 employees will retain their jobs after both sales close, with only a handful being placed on temporary contracts until a future decision is made.
The McKinney-Lindholm families planted the seeds of the business 75 years ago. Best Oil was founded in 1939, with the Little Store operation starting up in 1971.
"One of the leading things was the realization that there was no fourth generation [of the family] to take it over and that we are all getting older," McKinney said, explaining that the company has been contemplating a sale for some time.
McKinney told the newspaper the decision to sell came before the competing Kwik Trip chain entered the local market, although he acknowledged there was a "noticeable slowdown" for a time during the grand-opening sales at Kwik Trip's new locations. But he said since that time, regular customers have started to trickle back again.
Best Oil provides wholesale fuel oil delivery to 70 to 80 independent operators. McKinney said his brother John, who is president of the company, will stay on as director of that business, which will lease space from the McKinney family in the current headquarters building in Cloquet.