Although Alon's more-than-100-page November Securities & Exchange Commission (SEC) filing did not note the proposed price for the stock, nor the number of shares the company hopes to sell, it did say the company expects to raise as much as $100 million from the IPO.
Alon Brands plans to use the money raised by the IPO to fund a five-year capital-investment program to upgrade stores, implement a hot-food program and optimize retail fuel pricing. The 7-Eleven licensee touched on such plans in its SEC filing: "We plan to increase our foodservice sales by better leveraging 7-Eleven's foodservice program, implementing an independent hot-food program and significantly improving our beverage offerings, all of which carry higher margins than other retail products."
Alon currently owns and operates 306 convenience stores that are co-branded Fina and 7-Eleven, and has reported that it is the largest 7-Eleven licensee in the United States.
Alon Brands was established as a subsidiary of Alon USA in November with the intent of spinning it off as a public company. Following the IPO and as previously reported in CSP Daily News, Dallas-based Alon USA LP, a wholly owned subsidiary of Israel's Alon Energy, will continue to own more than 50% of the total voting power of the common shares, according to the SEC filing.
"We believe it will be a significant advantage for the retail business to run on its own and have its own access to capital, rather than be under the auspices of Alon Energy," Morris said during the Credit Suisse presentation.
Click herefor previous CSP Daily News coverage.
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