Arko Corp. has entered into two new financing arrangements that it says “enhance the company’s dealmaking flexibility and long-term growth strategy.”
On May 2, Arko subsidiary and convenience-store retailer GPM Investments LLC, entered into a third amendment to its program agreement with affiliates of Oak Street, a division of Blue Owl Capital. The amendment extends the term of the program agreement and provides for an aggregate up to $1.5 billion of capacity from the date the amendment was signed through Sept. 30, 2024. This $1.5 billion is in addition to the funding for the previously announced acquisition of WTG Fuels Holdings LLC, which is expected to close in the second quarter.
Additionally, subsidiary GPM Petroleum LP renewed and extended its revolving credit facility with a syndicate of banks led by Capital One, National Association. The credit line was increased by $300 million to $800 million, and its maturity was extended to May 2028.
In aggregate, Arko currently has more than $2 billion in available capital for continued merger-and-acquisition activity, including cash, lines of credit, and the extended Oak Street program agreement.
“We believe that these financial commitments position Arko to continue our long-term growth strategy well into the future,” said Arie Kotler, chairman, president and CEO of Arko Corp. “I believe we have the balance sheet strength and liquidity to continue pursuing multiple paths of growth, making disciplined, accretive acquisitions while investing in our core convenience store business to create value for our stockholders.”
- GPM Investments is No. 6 on CSP’s 2023 update of the 40 largest U.S. convenience-store chains by store count.
The new financing arrangements come on the heels of Arko Corp. having been rejected as a contender to purchased TravelCenters of America. Arko Corp., based in Richmond, Virginia, submitted a bid for the travel-center chain in March after TA had entered into a merger agreement with bp for $86 per share, or $1.3 billion. Arko offered $92 per share for TA, “an almost 7% premium,” Arko said.
TA, however questioned Arko Corp.’s ability to close the deal with the varying funding sources it had available and instead chose to stick with the bp offer.
Arko Corp., through GPM Investments, has been one of the most acquisitive retailers in the c-store industry for the past decade, closing nearly two dozen acquisition deals since 2013.
Richmond, Virginia-based Arko Corp. operates in four reportable segments: retail, wholesale, fleet fueling and GPM Petroleum, which sells and supplies fuel to its retail and wholesale sites. GPM Investments owns and operates c-store brands including Fas Mart, Shore Stop, Scotchman, BreadBox, Young's, Li'l Cricket, Next Door Store, Village Pantry, Apple Market, Jiffi Stop, Admiral, Roadrunner Markets, Jiffy Food Marts, E-Z Mart, 1 Stop, TownStarr, ExpressStop and Handy Mart.
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