DALLAS -- Although Alon Brands Inc. filed a motion with the Securities & Exchange Commission (SEC) on Tuesday to withdraw the initial public offering (IPO) paperwork it started back in November 2008 (see Related Content below for previous CSP Daily News coverage), that by no means precludes the refiner-marketer's intent to go public sometime in the future, officials told CSP Daily News.
"The filing we did in 2008 was outdated," said Kyle McKeen, president and CEO of Alon Brands, Dallas, noting that in addition to that much needed revision, SEC requirements had also evolved since the company completed the initial paperwork. "It doesn't change our intention to go public."
After necessary upgrades to its stores and the operational success of its "Clean Team" image program, Alon's retail earnings are four times greater today than in 2008, he said.
The larger plan is to break off its wholesale and retail operations from its already publicly traded parent, Alon USA, Dallas, allowing the new entity to focus on downstream operations, he said.
McKeen spoke to CSP Daily News from Clovis, N.M., where he was helping deliver a presentation on the company's Clean Team program (See Related Content below) to a large Alon-branded retailer, Allsup's Convenience Stores, which is based there.
At the time of the initial paperwork with the SEC, the effects of the recession and uncertain market activity gave Alon pause. In the years since, the company directed capital to image upgrades and operational changes that appear to have had a significant impact on store earnings. The activity may have eased the pressure to raise money via a public offering.
Yesterday's SEC filing stated that Alon Brands "has determined not to pursue the sale of the securities covered by the registration statement at this time. The company confirms that the registration statement was not declared effective and no securities have been sold pursuant to the registration statement."
Back in December of last year, McKeen referred to the IPO, telling CSP Daily News, "We have a registration document filed, and we continue to assess the market for the right opportunity."
Alon Brands originally put the project on the back burner in early 2009 as the U.S. economy faltered, noting that it was waiting for the economic tides to turn before putting much of its value in investors' hands. Yesterday, McKeen said the current economy continues to be soft.
"Fundamentally, what we want to do is be ready," said Jeff Morris, then Alon USA president and CEO, in February 2009. "I don't know when the market's going to open up, but whenever it is, we will be ready to open this up to the public."
Alon hoped to raise as much as $100 million from the IPO to upgrade stores, as well as expand foodservice efforts. "We're working on a hot-food program, and expanding fountain and coffee," McKeen said at the time of the filing. Since then, McKeen said work on the chain's operations and overall store cleanliness has translated into higher earnings, raising much-needed capital for these very efforts.
Alon Brands includes retail arms Southwest Convenience Stores LLC and Skinny's LLC, as well as Alon Marketing and SCS Beverage Inc. Alon Brands is the largest 7-Eleven licensee in North America, marketing motor fuel products at more than 600 distributor-serviced locations in the Southwest. The company's products also are sold at more than 300 additional company-owned locations in Texas and New Mexico.
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