SAN ANTONIO -- Tesoro Corp. may be joining other refiners in opting to put more of its branded retail sites in the hands of dealers based on its announcement yesterday, as reported in a CSP Daily News Flash, that it has sold 13 of its sites in western Washington to independent marketer MYOB LLC.
On its surface, the sale is similar to those made in recent months by Shell Oil Products US and BP, both of whom are opting to own fewer sites while selling them off with supply agreements attached.
A Tesoro spokesperson asked about the [image-nocss] sale referred only to chairman, president and CEO Bruce Smith's statement in the company's press release. "We are focused on marketing our refinery production in each region through trade channels that offer Tesoro the greatest shareholder value," he said. "Our commitment to our retail function remains strong as we work on various projects to strengthen our retail asset portfolio in regions where it provides value above other alternatives."
BP has sold or is selling well over 300 company-owned stores so far this year as it continues to rationalize its store portfolio. Meanwhile, Shell sold 40 stores in the Indianapolis market to Alimentation Couche-Tard in February and is expected to place more on the market as it converts the markets from its multi-site operator (MSO) model to the wholesale class of trade.
MYOB co-owner Howard Bode said the Tesoro deal came about while the two companies were discussing branding opportunities. We were exploring some strategic options to work with them on operating and branding sites, and the discussions came about of them wanting to recapture some of the investment they had in real estate, he told CSP Daily News.
MYOB is an independent marketer based in Carlsbad, Calif. It has 71 existing retail locations in four states, including 25 in the state of Washington. Bode said more growth is on the horizon for MYOB. We've got a couple deals in the works, he said. We hope to be at 100 stores by the end of the year."
The company's agreement with Tesoro calls for MYOB to acquire six locations and lease or sublease the remaining seven. Three of the locations nearest Tesoro's Anacortes, Wash., refinery will retain the Tesoro brand and the remaining sites will be supplied by Tesoro through an unbranded sales agreement.
The signing of the agreement initiated a 45-day due diligence period, which will be followed by closing within 35 days of completion and resolution of any due diligence issues.
Tesoro Corp. is an independent refiner and marketer of petroleum products. It operates six refineries in the western United States with a combined crude oil capacity of more than 560,000 barrels per day. Tesoro's retail marketing system includes more than 475 branded retail stations, of which more than 200 are company operated under the Tesoro and Mirastar brands.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.