The Pantry, which operates more than 1,640 convenience stores in the southeastern U.S., is expanding its portfolio into two new states after agreeing last month to purchase 47 stores in Kansas and Missouri from Presto Convenience Stores LLC.
âThis acquisition expands our geographic footprint and creates new fill-in opportunities for future growth,â said Pantry President and CEO Terrance M. Marks. The deal marks The Pantryâs first venture into both of these states.
The acquisition will include the real estate underlying 36 of the 47 locations. Of the stores, 44 are located in Kansas with three are in Missouri. The stores operate under the Presto trade name and generated revenues of approximately $194 million during the 12 months ended May 2010, according to The Pantry, which operates primarily under the Kangaroo Express brand
Presto President Terry Presta added: âIâve been privileged to watch the company that is now Presto grow from a single service station in Scott City, Kan., to just under 50 convenience stores in Kansas and Missouri. This move by The Pantry is a strong vote of confidence in our sites and in the communities we serve. Because of The Pantryâs vast resources and strong management, this sale will be very positive for our employees and customers.â
Presta, who has more than 30 years of experience in the convenience store industry and is a past president of ConocoPhillipsâ national marketer advisory board, will be retained by The Pantry for a three-year period to assist in the transition, according to NRC Realty & Capital Advisors LLC, which served as the exclusive financial advisor to Presto.
The sale transaction also includes Prestoâs wholesale fuels business and ethanol blending operations, according to NRC. The majority of stores are concentrated in the Wichita market, with an additional four stores each in the Kansas City and Lawrence markets, and the balance throughout western Kansas, the company stated. Roughly two-thirds of the stores sell fuel under the Conoco or Phillips 66 brands, with the remaining stores selling Presto private-branded fuel.
The Pantry expects to fund the deal with cash on hand, and said the transaction should be accretive to earnings per share in the first 12 months after closing. The acquisition, which is subject to approvals and customary closing conditions, is expected to close in the first quarter of fiscal 2011.
In separate Pantry news, the retailer announced the appointment of Mark R. Bierley as senior vice president and chief financial officer, effective Sept. 27, 2010. Bierley will replace Frank G. Paci, who informed the board that he plans to resign from the company, effective Sept. 26, 2010, to pursue other interests.
Commenting on Paciâs resignation, Marks stated: âWe sincerely appreciate Frankâs financial leadership during his tenure with The Pantry and wish him nothing but the best in his future endeavors. Frank has played an important role in The Pantryâs success and we are pleased that he will remain a consultant through the end of the year to help effect a smooth transition.â
After the effective date of his resignation, Paci agreed to provide transition consulting services to the company until Dec. 31, 2010.
Bierley joins The Pantry from Borders Group Inc., where he most recently held the post of chief operating officer and CFO since June 2010. Bierley joined the book store chain in 2006, and held a variety of financial management positions during this time there, including executive vice president and CFO from January 2009 through June 2010. Prior to working with Borders, Bierley held positions in the financial departments for Dunhamâs Athleisure Corp., a Midwest sporting goods and apparel retain chain, and Federal-Mogul Corp., a global automotive parts manufacturer.
Bierley began his career as an auditor for PricewaterhouseCoopers LLP in Detroit.
âWe are delighted to welcome Mark to The Pantryâs management team. Mark brings broad professional experience and deep retail industry knowledge that will allow him to quickly add value as The Pantryâs CFO,â Marks said.
For a detailed report on the ongoing transformation of The Pantry with its new âFresh Initiativeâ strategy focused on foodservice, as well as a behind the scenes look at the companyâs culture with video, go to www.csnews.com.