PetroSun to Acquire 600 ConocoPhillips Sites
By Mehgan Belanger
NEW YORK -- PetroSun Fuel, an independent 120-unit c-store operator headquartered in Seattle, signed a definitive agreement here yesterday to acquire nearly 600 of ConocoPhillips’ company-owned c-store and gas retail locations.
The purchase is the biggest of its kind from an oil company to a private company of PetroSun’s size in the retail segment, according to Sam Hirbod, chairman and CEO of PetroSun and its newly created affiliate, Pacific Convenience & Fuel LLC.
"They’ve got really premium assets, and it was the only package available in our sector that you can buy in bulk to include premium corners in major metropolitan areas, such as San Francisco, Los Angeles, Denver, Portland, Ore., Albuquerque, etc.," Hirbod told CSNews Online, explaining PetroSun was created to acquire mid- to large-sized portfolios in the gas retailing industry.
PetroSun was one of many c-store operators vying for the sites, according to Hirbod. "Every big name from Couche-Tard to 7-Eleven threw their names into the hat. The big guys even offered to partner with us on a bid, but we weren’t interested," he said. "We analyzed what was important to ConocoPhillips other than the price, and we put together a robust, well thought out and granular bid, and was able to beat everyone else out."
As reported yesterday in a CSNews Online newsflash, the stations are located across 10 U.S. states and will be operated under PetroSun’s newly created affiliate, Pacific Convenience & Fuel LLC, which was developed to take on this portfolio, according to Hirbod. The transaction is expected to complete the sale of all ConocoPhillips’ remaining U.S. company-owned and -operated retail outlets, along with its U.S. company-owned and dealer-operated sites, according to a company statement.
"This transaction is designed to strengthen our branded wholesale business model and grow market share," Clayton Reasor, president of U.S. marketing at ConocoPhillips, said in a statement. "We have worked with PetroSun before and believe they will continue to enhance our brands and provide excellent service to our retail customers."
Previously, PetroSun completed two separate agreements with ConocoPhillips, one of which was the divesture of ConocoPhillips’ wholesale operations to individual sales, said Hirbod, noting the company continually grows through smaller purchases of stores.
This purchase brings the company to many new markets such as Colorado and the Midwest, Hirbod said. Additionally, there is virtually no overlap between ConocoPhillips’ stores and PetroSun’s existing sites, and where there is overlap, PetroSun was given the flexibility to use ConocoPhillips’ other fuel brands, he added.
As part of the current agreement, Pacific Convenience will enter into long-term supply agreements with ConocoPhillips and continue to fly the Conoco, Phillips 66 and 76 retail banners at its stations.
Regarding changes to the convenience stores, Hirbod said the company is "weighing all the options," including taking a look at the existing Circle K franchises, which are at all the nearly 600 stores, as well as other c-store brands.
The company sought out this purchase because it "wanted to be part of the consolidation happening in the retail sector," said Hirbod. "The oil companies are leaving retail. We believe there will be more opportunities and a more fluid marketplace, and we are in position to control the best corners and have the best position to compete in the marketplace."
The sites are estimated to generate annual petroleum sales in excess of one billion gallons, according to Hirbod.
As part of the transaction, PetroSun will add more than 75 of its existing locations in Washington and California to Pacific Convenience’s store count. These stores will also be branded ConocoPhillips and currently boast car washes and foodservice, among other things, he said.
After the deal is closed, Pacific Convenience will own, manage or operate more than 600 sites in the western United States.
Meanwhile, Tower Energy Group, an independent petroleum wholesaler, also entered into an arrangement with Pacific Convenience to supply fuel to the dealer sites in California.
NEW YORK -- PetroSun Fuel, an independent 120-unit c-store operator headquartered in Seattle, signed a definitive agreement here yesterday to acquire nearly 600 of ConocoPhillips’ company-owned c-store and gas retail locations.
The purchase is the biggest of its kind from an oil company to a private company of PetroSun’s size in the retail segment, according to Sam Hirbod, chairman and CEO of PetroSun and its newly created affiliate, Pacific Convenience & Fuel LLC.
"They’ve got really premium assets, and it was the only package available in our sector that you can buy in bulk to include premium corners in major metropolitan areas, such as San Francisco, Los Angeles, Denver, Portland, Ore., Albuquerque, etc.," Hirbod told CSNews Online, explaining PetroSun was created to acquire mid- to large-sized portfolios in the gas retailing industry.
PetroSun was one of many c-store operators vying for the sites, according to Hirbod. "Every big name from Couche-Tard to 7-Eleven threw their names into the hat. The big guys even offered to partner with us on a bid, but we weren’t interested," he said. "We analyzed what was important to ConocoPhillips other than the price, and we put together a robust, well thought out and granular bid, and was able to beat everyone else out."
As reported yesterday in a CSNews Online newsflash, the stations are located across 10 U.S. states and will be operated under PetroSun’s newly created affiliate, Pacific Convenience & Fuel LLC, which was developed to take on this portfolio, according to Hirbod. The transaction is expected to complete the sale of all ConocoPhillips’ remaining U.S. company-owned and -operated retail outlets, along with its U.S. company-owned and dealer-operated sites, according to a company statement.
"This transaction is designed to strengthen our branded wholesale business model and grow market share," Clayton Reasor, president of U.S. marketing at ConocoPhillips, said in a statement. "We have worked with PetroSun before and believe they will continue to enhance our brands and provide excellent service to our retail customers."
Previously, PetroSun completed two separate agreements with ConocoPhillips, one of which was the divesture of ConocoPhillips’ wholesale operations to individual sales, said Hirbod, noting the company continually grows through smaller purchases of stores.
This purchase brings the company to many new markets such as Colorado and the Midwest, Hirbod said. Additionally, there is virtually no overlap between ConocoPhillips’ stores and PetroSun’s existing sites, and where there is overlap, PetroSun was given the flexibility to use ConocoPhillips’ other fuel brands, he added.
As part of the current agreement, Pacific Convenience will enter into long-term supply agreements with ConocoPhillips and continue to fly the Conoco, Phillips 66 and 76 retail banners at its stations.
Regarding changes to the convenience stores, Hirbod said the company is "weighing all the options," including taking a look at the existing Circle K franchises, which are at all the nearly 600 stores, as well as other c-store brands.
The company sought out this purchase because it "wanted to be part of the consolidation happening in the retail sector," said Hirbod. "The oil companies are leaving retail. We believe there will be more opportunities and a more fluid marketplace, and we are in position to control the best corners and have the best position to compete in the marketplace."
The sites are estimated to generate annual petroleum sales in excess of one billion gallons, according to Hirbod.
As part of the transaction, PetroSun will add more than 75 of its existing locations in Washington and California to Pacific Convenience’s store count. These stores will also be branded ConocoPhillips and currently boast car washes and foodservice, among other things, he said.
After the deal is closed, Pacific Convenience will own, manage or operate more than 600 sites in the western United States.
Meanwhile, Tower Energy Group, an independent petroleum wholesaler, also entered into an arrangement with Pacific Convenience to supply fuel to the dealer sites in California.