As reported in a Morgan Keegan/CSP Daily News Flash yesterday, all of the stores are located in Minnesota, operating under the NuMart banner. They will be immediately rebranded to Casey's, [image-nocss] the Ankeny, Iowa-based retailer said.
Aside from the brand name changes, the retail customers at the 11 locations should see very little change, according to the companies.
The stores are located in Amboy, Butterfield, Fairmont, Pipestone, Sherburn, St. James (two stores), Trimont, Truman, Welcome and Wells.
NuWay's "cardtrols" (cardlocks) are not a part of this transaction. NuWay Cooperative will continue to operate them, it said.
The transfer of ownership will take effect April 30, 2011.
"The decision to sell these stores did not come easily. Casey's made a fair offer to purchase our stores, and our board spent many hours debating the sale," Jones said. "Casey's has indicated their intention to continue serving the communities in which NuMart Convenience Stores are located, and all basic services should stay intact. The communities will undoubtedly benefit from new services and resources Casey's brings to these locations."
Jones said, "With the sale of our retail properties, NuWay Cooperative will continue to operate its agronomy and energy businesses with an eye toward other industries and opportunities to serve our member-owners and our communities."
Chairperson Dan Bebernes said, "Casey's has approached us several times in recent years, and we have repeatedly declined to sell. Instead, we planned to grow the size of our chain of NuMart stores. Over five years, we've considered purchasing nearly 60 stores. In each case, we were unable to come to terms with the owners because the price was too great for the return projected, or they represented too great a risk. Several months ago, Casey's again approached NuWay Cooperative with a considerably improved offer."
He added, "The board and management of NuWay Cooperative spent many hours debating whether or not this revised proposal would be positive for the members and patrons of the cooperative and for the communities we serve."
Among the points NuWay considered: The current value of NuMart's stores. "Casey's offer was, by some industry estimates, significantly better than what we could expect for our chain of 11 stores," said Bebernes. The future of the c-store business. "We have experienced increasingly fierce competition from national chains building within our rural trade territory, which has greatly affected profitability," he said. "We believe this will be a continuing trend." The impact of the sale on employees and customers of NuMart's stores. "Casey's has indicated that they are very motivated to keep all business locations open and to do their best to retain all employees who wish to continue to work for them," he said.Bebernes concluded, "In the end, the board decided that Casey's offer for our 11 retail stores was too good to pass up."
NuWay Cooperative is not in financial trouble, it said. "Anyone who has looked at our balance sheet over the past five years is aware that we are financially healthy. Our 11 NuMart Convenience Stores have been and continue to be profitable. We could have continued to operate these stores if Casey's had not approached us with an offer that was simply too good to pass up," NuWay said on its website.
"The successful completion of our five-year plan--which included reducing debt, improving balance sheet ratios, retiring allocated equities, and improving the company assets--has placed us in an excellent position.
"The retail division represented approximately 40% of NuWay Cooperative's total sales, so structural changes will need to be made.... Part of the retail division's role was to provide cash flow to support services which benefit our membership. Our current plan is to use some of the proceeds to reduce our term debt and our need for seasonal borrowing. Beyond that, one of the board's primary goals has been the repayment of equity. At some point in the future, we may consider repaying allocated equities (in part or completely) to our patrons."
Ankeny, Iowa-based Casey's has more than 1,530 stores in nine Midwestern states, primarily Iowa, Missouri and Illinois.
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