Waring Oil buy bolsters Mississippi, Louisiana markets
SANFORD, N.C. -- In a move that strengthens its presence in Mississippi and Louisiana, The Pantry Inc. has moved to acquire 39 convenience stores from Waring Oil Co. The stores, as reported yesterday in a CSP Daily News Flash, generated total revenues of about $100 million in 2004 and operate under the name Interstate Food Stop. Terms of the purchase were not disclosed.
The stores will complement the company's 61 sites already in those states, said Peter Sodini, president and CEO of The Pantry. This transaction is consistent with our tuck-in acquisition [image-nocss] strategy, which is focused on adding stores that enhance our market presence, Sodini said in a statement. Further, we expect the addition of these units to be immediately accretive to our earnings per share."
The Pantry came in and made an offer acceptable to the company, said Doug Greenough, who heads retail operations for the Vicksburg, Miss.-based Waring Oil. Greenough told CSP Daily News, The industry is consolidating, and it's getting harder to be a smaller operator.
Waring Oil's top management was preparing for a day of store visits to speak with managers yesterday. The deal is expected to close in the second quarter of The Pantry's fiscal year, but may close as early as next January or February. Once the sale of c-store assets is complete, Waring Oil will continue to manage its propane, lubricants and tanker distribution businesses, Greenough said.
The acquisition is subject to regulatory approvals and other closing conditions. According to a company statement, Pantry officials plan to finance the transaction with cash on hand and seller lease financing.
One of the largest independently operated chains in the country, Sanford, N.C.-based The Pantry reported net sales for fiscal 2005 of approximately $4.4 billion. The company operates roughly 1,400 stores in 11 Southeastern states under many names, including Kangaroo Express, Golden Gallon and Cowboys.