GREENVILLE, S.C. -- Kaman Holdings (Mendelson Group) Ltd. subsidiary Isal Amlat Investment Ltd., Herzliya, Israel, has announced the acquisition of nine gas stations and convenience stores from Convenience & Petroleum Markets LLC (CPM), which operates under the Pumper's Premium label, for $11.2 million, plus an additional sum for inventory, said Israeli newspaper Globes.
The parties also agreed that Isal shareholders will invest an additional $6 million in expanding CPM's gas stations and c-stores through mergers and acquisitions until Isal owns 85% [image-nocss] of CPM, the report said.
The stations are located along the main Atlanta-to Charlotte, N.C., corridor. Before this deal, Greenville, S.C.-based CPM operated 10 Pumper's Premium locations in South Carolina and eight Gasland stations in Illinois, offering the CITGO and Shell brands of gasoline.
CPM owns the land on which four of the properties are located and leases the land for five other properties in contracts with an average of 25 years. Isal also plans to buy land for more gas stations, the paper said.
Yitzhak Tshuva's son-in-law, Roni Elroyi, has decided to model Kaman Holdings (Mendelson Group) Ltd., which he controls and heads, on Delek Group Ltd., Giborei Israel, which is controlled by Tshuva, said Globes. Delek owns a majority of Franklin, Tenn.-based Delek US Holdings Inc., which markets gasoline, diesel and other refined petroleum products and convenience merchandise through a network of 389 company-operated retail fuel and c-stores, operated under the MAPCO Express, MAPCO Mart, East Coast and Discount Food Mart brands.
Isal said CPM posted a net profit of $2 million on $41 million revenue in 2005 from leasing Pumper's Premium stations. Isal added that CPM CEO Steve Whitney and its CFO would keep their posts, managing the company on Isal's behalf, said the report.
In late April, Kaman USA Holdings Inc. hired investment banking firm Morgan Keegan & Co. Inc. to assist the company with its acquisition strategy. Kaman had said it was looking for a platform acquisition and anticipates building an extensive network through acquisitions over the next several years. It had said it would initially focus on acquisitions of businesses consisting of 20 to 75 company-operated stores located in the Southeast, East Coast and Midwest regions of the United States.
Kaman had said it was seeking to acquire a company with significant real estate ownership. It was also looking for mature operating businesses with experienced operational management teams. It had said it would also be interested in acquiring petroleum distributors and oil and gas production companies.
The convenience store industry remains highly fragmented with excellent opportunities for consolidation, Benny Davidson, vice president of business development of Kaman, said at the time. We have engaged Morgan Keegan in an effort to expedite our growth. Together, we will initially seek acquisitions meet our criteria including sufficient market density, superior quality assets, experienced management and history of profitability.
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