Three Major Convenience Channel Players Expected to Submit Rival Bids for Speedway

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Three Major Convenience Channel Players Expected to Submit Rival Bids for Speedway

07/23/2020
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ENON, Ohio — Industry watchers are keeping an eye out for any possible acquisition of Speedway LLC to take the next step.

According to Reuters, Alimentation Couche-Tard Inc., Seven & i Holdings Co. and private equity firm TDR Capital are expected to make an offer on Marathon Petroleum Corp.'s (MPC) retail arm this week.

The expected bidders are a list of heavy hitters in the convenience channel. Couche-Tard is the parent company of Circle K, Tokyo-based Seven & i Holdings is the parent company of 7-Eleven Inc. and TDR is the firm behind EG Group.

Citing sources familiar with the dealings, the news outlet reported that Laval, Quebec-based Couche-Tard is looking to team up on any acquisition. Bringing in a partner could head off any potential antitrust concerns that the Federal Trade Commission may raise.

The company is reportedly looking for a partner to take at least 850 of the Speedway convenience stores. The Enon-based chain has close to 4,000 c-stores.

According to Reuters, Couche-Tard has been in talks with private equity firms on a joint bid, including New York-based Cerberus Capital Management LP. Previous reported talks with London-based TDR fell apart when the two companies could not agree on how to divide Speedway's assets. TDR has now raised financing for an all-cash bid of its own, sources said.

In addition to these three, some smaller companies and buyout firms are in talks about partnering with a larger player on a bid. El Dorado, Ark.-based Murphy USA Inc. is also considering participating in the auction for Speedway, two of the sources told Reuters.

This is the second time this year that MPC is entertaining offers for Speedway. In February, Seven & i Holdings and TDR, emerged as potential buyers. Subsequent reports put 7-Eleven's parent company in exclusive talks to buy Speedway for approximately $22 billion; however, those talks came to an end in early March, as Convenience Store News previously reported.

Reports of a Speedway deal picked back up again in June.

For its part, MPC said last month that it was moving toward its original plan to spin off Speedway, a decision it announced in October. The completion date, though, has been pushed back from the end of 2020 to early 2021.

Findlay-based MPC is an integrated downstream energy company. It operates the nation's largest refining system with more than 3 million barrels per day of crude oil capacity across 16 refineries. MPC's marketing system includes branded locations across the United States, including Marathon brand retail outlets.