The Pantry Looks to Buy

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The Pantry Looks to Buy

By Mitch Morrison - 07/11/2003
SANFORD, N.C. -- Quiet for the past several years, The Pantry Inc., the largest convenience chain in the Southeast with more than 1,200 stores, is back in acquisition mode.

In an exclusive interview with Convenience Store News, Jon Ralph, general partner of Freeman Spogli & Co., the California venture capital group that owns The Pantry, said the retailer is well positioned to renew an expansion effort first launched in the late 1990s when the Sanford, N.C.-based operator of brands such as Lil' Champ, Kangaroo, Handy Way and Big K battled other rollup companies like Swifty Serve and Convenience USA in the Southeastern region.

"I know other organizations have pulled out of the convenience store industry, but we think it's a fine industry," Ralph said. "We're comfortable in it and see the stars aligning for better opportunities. There are more sellers than buyers. We're interested in being a buyer."

The Pantry, which launched an initial public offering four years ago, rapidly grew to some 1,300 stores in the late 1990s through a series of acquisitions. However, unlike its rivals, the company avoided the insurmountable pitfalls of debt financing that ultimately knocked out chains like Swifty Serve, Dairy Mart and Clark Retail Enterprises.

The Pantry has been quiet on the acquisition front the past three years, but internally the company has been busy. Ralph said the chain has invested in its stores -- including a complete overhaul of the Kangaroo brand -- streamlined back-office systems and re-merchandised scores of locations. "The strategy has never been about getting big for big's sake -- rather, it is to strengthen our market position."