HOUSTON -- With two of its markets yet to be divested this year, industry-watchers are keeping an eye on the selloff of 678 Shell stores as the oil company continues its conversion of all but nine markets to branded-wholesale status. And others are watching Canadas Alimentation Couche-Tard to see how its relationship with Shell might expand.
We are looking to provide transition opportunities to branded wholesale in [nine more] markets,VbCrLf a Shell spokesperson told CSP Daily News.And while Couche-Tard has purchased more than 230 sites from [image-nocss] Shell, company representatives are quick to note theres no done dealVbCrLf on any of the remaining markets.
Every transition is fully examined to ensure the sale goes to the company best qualified to operate the sites in that area,VbCrLf Shell spokesperson Anne Peebles said. Opportunities have been provided to many wholesalers strategically aligned with Shell/Motiva, not just to Circle K/Couche-Tard; for example, the Austin area sold to Landmark, Columbus to True North, Cincinnati to Gilligan Oil and Birmingham to McPherson.VbCrLf
Of the remaining markets scheduled to be sold off"Alaska, Dallas, Hawaii, Houston, Kansas City, New Orleans, Philly/South Jersey, Portland and Sacramento"a stock analyst close to Laval, Quebec-based Couche-Tard told CSP Daily News the company would most be interested in the Texas markets, areas where the company already has a growing presence.
The analyst, who asked not to be identified, said the company also may have some interest in the Kansas City and New Orleans markets. And while California is a growing area for Couche-Tard, it would need a critical massVbCrLf for the Sacramento market to be of value. Shell, however, only has 60 stores in that market. The Alaska, Hawaii, Philly/South Jersey and Portland markets would not appeal to the company, he said.
Attempts to reach Couche-Tard representatives for comment were unsuccessful at news time.
Houston-based Shell is transitioning to a branded-wholesale strategy in all but nine core markets" Boston, Chicago, Los Angeles, New York, San Diego, San Francisco, Seattle, Southeast Florida and Washington, D.C."in the United States.
In order for Shell to become the best fuels retailer in the world, Shell Oil Products US and Motiva Enterprises LLC continually evaluate the way that we do business to ensure the Shell brand is positioned for growth,VbCrLf said a spokesperson. The company is focusing on three key areas of our Global Retail Strategy:
Enhance wholesale business. Portfolio optimization and asset management. Retail structure realignment.Markets already sold off as part of the three-year process include Atlanta; Austin, Texas; Baton Rouge, La.; Birmingham, Ala.; Cincinnati; Columbus, Ohio; Connecticut; Denver; Indianapolis; Memphis, Tenn.; Orlando; Southwest Florida; and Tampa, Fla.
The change [of ownership] should be transparent to the consumers with the stations switching from direct to wholesale. Consumer services will not be interrupted,VbCrLf the spokesperson said. The goal is to transition these markets between now and the end of 2007. After the transitions have been completed, Shell will own approximately 2,000 sites in the U.S.VbCrLf
Couche-Tard has capitalized on Shells strategy change with purchases in Baton Rouge (22), Denver (71), the Memphis area (16), Orlando (28), Southwest Florida (46) and Tampa (53). Of the 236 sites, 175 are company-operated, 49 are operated by dealers and 12 have a motor fuel-supply agreement. Also, 174 of the stores are former Shell multi-site operator (MSO) sites.
Signs of a growth partnership germinated in late August, when Couche-Tard signed an agreement with Shell to lease and operate 31 stores in the Chicago metropolitan area, an MSO-like experiment for both Shell and Couche-Tard. The relationship showed signs of flourishing in October with a deal that provides for the conversion of approximately 250 existing Circle K sites to the Shell brand in the same and other U.S. markets. Under these arrangements, the convenience stores will remain Circle K branded while the fuel offering will become Shell branded.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.