The terms of the purchase were not disclosed. As reported in a Morgan Keegan/CSP Daily News Flash yesterday, the retail assets are located in the Buffalo, Syracuse, Albany and Rochester markets of central and northern New York.
"The acquisition of these 25 [image-nocss] sites shows that we are making progress in growing our retail fuels and convenience business," Elsenhans said. "We believe our brand- and logistics-led strategy will continue to generate value for shareholders."
Bob Owens, Sunoco's senior vice president of marketing, added, "This purchase shows our commitment to smartly growing our retail presence in areas where we enjoy great brand recognition and have strong logistics assets. These high-quality locations strengthen our position in upstate New York markets."
(Click here for previous CSP Daily News coverage of the strategy shift.)
The company said that 10 of the newly acquired locations will be company operated. Direct franchise dealers will operate the remaining stations. The sites will begin conversion to the Sunoco brand starting in April 2011.
(Click here for additional coverage.)Lehigh Gas did not respond to a request for comment by press time.
Lehigh Gas is a distributor of branded petroleum in the Northeast. According to CSPedia.net, it has about 100 corporate-owned locations and up to 300 dealer sites. All of the corporate-owned c-stores are branded On the Run with Mobil fuel. Lehigh's other brands include Uni-Mart, ampm, BP and Exxon stations.Earlier this month, Sunoco said that it reached an agreement to sell its 170,000-barrel-per-day refinery in Toledo, Ohio, to Toledo Refining Co. LLC, a wholly owned subsidiary of PBF Holding Co. LLC. Sunoco for approximately $400 million.
"Selling the Toledo refinery will enable us to direct resources and management focus toward growing the logistics and retail businesses where we have competitive advantages, as well as generate cash and strengthen our balance sheet. These businesses are generating significant value today and represent strong opportunities for future growth," Elsenhans said.Separately, Sunoco has announced that it has been selected by The Ohio Turnpike Commission to operate the fuel stations at the 16 service plazas along the Ohio Turnpike under an initial lease agreement from 2012 through 2016 with renewals available through 2026. Sunoco had previously operated the service plazas from 1994 through 2006.
"This agreement marks another step in smartly growing our retail presence in areas where we enjoy solid brand recognition," said Elsenhans. She added that this deal also illustrated that the company is "focused on pursuing a brand- and logistics-led strategy."
Owens said, "With nearly 500 retail sites already in Ohio, these 16 high-quality, high-volume locations will help keep Sunoco's brand presence strong. In addition, this agreement further positions Sunoco as the leading transportation fuels retailer on toll roads."
Combined, the service plazas currently sell approximately 35 million gallons of gasoline annually, 10 million in diesel each year, and generate nearly $2 million in store sales along the 241-mile turnpike that stretches through northern Ohio from Pennsylvania to Indiana.
In addition to selling fuel, Sunoco will also operate APlus convenience stores at no fewer than four of the locations. The two westernmost plazas, Indian Meadow and Tiffin River, are currently under construction for complete redevelopment and will open in June 2011 with Sunoco APlus branded convenience stores. The remaining locations will transition to Sunoco at the start of the contract in January 2012. In June 2012, the two easternmost plazas, Mahoning Valley and Glacier Hills (redevelopment of which is scheduled to commence in the spring of 2011), will also reopen with Sunoco APlus branded convenience stores.
Philadelphia-based Sunoco is a leading transportation fuel provider, with operations located primarily in the East Coast and Midwest regions of the United States. The company operates more than 4,800 branded retail locations that market transportation fuels and convenience store merchandise in 23 states. This retail network is principally supplied by Sunoco-owned refineries with a combined crude oil processing capacity of 675,000 barrels per day.
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