New action taken in the tangled web that is Mountain Express Oil Co.'s bankruptcy gives little hope to the likelihood the retailer will emerge from bankruptcy. In a series of court orders Thursday, the judge in U.S. Bankruptcy Court in Texas converted the filing from Chapter 11 to Chapter 7 bankruptcy, essentially directing Mountain Express to liquidate its assets.
Mountain Express filed for voluntary protection under Chapter 11 in March. At the time, the fuel distributor and convenience-store retailer said it intended to undertake a comprehensive restructuring and continue to conduct business throughout the process.
A restructuring, it said, “will strengthen the company’s fuel distribution business, dealer network and retail business.”
However, a series of missed payments to gasoline suppliers have since forced operators to close their stores, which include fuel centers, travel centers and convenience stores.
As a result, Judge David R. Jones terminated all of Mountain Express Co.'s real estate leases effective immediately.
- With 166 c-stores, Mountain Express Oil Co. ranked No. 50 on CSP’s 2023 Top 202 ranking of convenience-store chains by store count.
Working with investment banker Raymond James & Associates, Mountain Express had previously conducted an auction of most of its properties, with retailer Arko Corp., Richmond, Virginia, as the apparent winning bidder, offering $49 million. That deal has since fallen through, and Raymond James has withdrawn as a party to bankruptcy.
It's now likely all of Mountain Express' retail properties will be sold off in whole or pieces.
Meanwhile, the court is allowing “counterparties,” generally store operators and gasoline and product suppliers, to “exercise any and all rights to sell fuel to, re-let, and/or enter into agreement with other distributors, lessees or any other party, as applicable” to allow the stores to continue to operate.
The court has also ordered that “any owner of property on which an abandoned c-store is situated may immediately enter the premises and take reasonable actions to secure, protect and maintain the property.”