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2020 Retail Chain Dossier: Yesway

Economic downturn provides a chance to integrate largest acquisition yet
Photo illustration by CSP Staff

WEST DES MOINES, Iowa — In 2019, five convenience-store chains rose to the top of the most aggressive growth companies in the industry. As part of its 2020 Top 202 list, CSP analyzes those chain's standing in mergers, acquisitions and new-store construction.

BW Gas & Convenience Holdings LLC (dba Yesway)

Headquarters: West Des Moines, Iowa

2020 Rank: No. 17

Code Name: Upstart

Insight:With its boldest acquisition yet, Yesway is departing from its rural-centric strategy of buying smaller portfolios in less-populated markets.

While the convenience industry slowed down M&A in 2019 compared to the year prior, Yesway stepped on the gas. It ended 2019 with the acquisition of 304 Allsup’s Convenience Store locations, catapulting the chain from No. 43 to No. 17 on CSP’s Top 202 ranking, with 421 company-owned and -operated units.

The Allsup’s acquisition represented a change of strategy for Yesway. Previously, Yesway had bought well-operated stores in small communities and remodeled them into Yesways. Past purchases were of smaller portfolios of five, 20 or 30 chains in states such as Iowa and Texas. The acquisition was also a departure from Yesway’s branding strategy: It plans to keep the Allsup’s brand intact, including its famous deep-fried burritos. “They have a 63-year-old iconic brand with destination foodservice items,” Yesway CEO Tom Trkla told CSP shortly after the acquisition.

Trkla said Allsup’s founders, Lonnie and Barbara Allsup, built a portfolio in a very similar way to Yesway, “which is to target more rural and suburban locations and less city-center locations,” he said. “There’s a very consistent parallel between the two portfolios.”

The timing of Yesway’s planned slowdown in acquisitions, as it seeks to integrate Allsup’s, with the decline in industry M&A activity due to the coronavirus has been fortuitous.

“We won’t take another large acquisition until this one’s completed,” Trkla said.

Click here to view complete Top 202 list.

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