Global convenience-store company EG Group is looking to exit Australia after five years in the country, according to a Bloomberg report, which cited “people familiar with the matter.”
EG Group declined to comment to CSP.
The Blackburn, U.K.-based company bought 540 gas station sites in Australia for $1.1 billion in 2018.
The convenience-store chain and gas station operator is eager to sell a business unit it has already had to write down in value twice, according to a person who asked not to be identified discussing confidential information.
There have been discussions with interested parties in recent months, but agreeing on an acceptable price could be difficult.
“If an asset is potentially more appropriately owned by a third party, then the board will consider it,” a spokesperson for EG said, adding that the group regularly reviews the company’s portfolio.
Initially, EG had planned further expansion in Australia, and in 2020 offered to buy Caltex Australia Ltd., which would have added a further 2,000 sites in the country, according to Bloomberg.
- EG America is No. 5 on CSP’s 2023 Top 202 ranking of c-store chains by number of company-owned retail outlets.
EG Group completed the sale and leaseback transaction in the United States and other U.S. non-core asset disposals in 2023, which generated combined proceeds of around $4 billion to decrease debt from around $10 billion at Jan. 1, 2023, to about $6 billion at Dec. 31, 2023.
In October, EG Group sold the majority of its fuel, foodservice, grocery and merchandise business in the United Kingdom and Ireland to U.K. supermarket chain Asda for $2.5 billion.
Additionally, EG America laid off 90 employees on Jan. 5. as “part of a broader effort to control costs and remain competitive in an evolving retail landscape,” a spokesperson for the convenience-store chain told CSP.
Co-CEOs and brothers Moshin and Zuber Issa founded EG Group in 2001. Zuber Issa recently revealed a plan to step down as co-CEO of EG Group, leaving the company in the hands of his older brother Mohsin, according to a bond prospectus seen by Bloomberg News. Chief Operating Officer Salim Hasan also intends to step down. Those changes will only happen once Zuber completes his own deal to buy a number of sites from EG Group, according to the document.
- Moshin and Zuber Issa were among CSP's Power 20 Deal Makers in 2020.
EG Group currently has more than 6,600 sites across the United Kingdom and Ireland, Europe, the United States and Australia. The company established itself in the United States in 2018 as EG America by acquiring Kroger’s 762-site c-store network. It acquired TravelCenters of America’s Minit Mart c-store business for approximately $330.8 million in 2018. The portfolio included 225 c-stores. And in 2019, among other acquisitions, EG Group acquired Cumberland Farms and its nearly 660 c-stores in the Northeast and Florida, and EG America now has its headquarters in Westborough, Mass. With more than 1,750 sites across 33 states, U.S. c-store brands include Cumberland Farms, Certified Oil, Fastrac, Kwik Shop, Loaf N’ Jug, Minit Mart, Quik Stop, Sprint Food Stores, Tom Thumb and Turkey Hill.
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