Management Re-imaging

Gulf Oil, Cumberland Farms consolidate, streamline organizational chart

Greg Lindenberg, Editor, CSP

NEWTON, Mass. -- Amid a retail brand tune-up, Gulf Oil LP—along with its parent, Cumberland Farms Inc.—is consolidating and streamlining the management teams of both companies to increase operational efficiency. As reported in a CSP Daily News Flash yesterday, Gulf Oil chief executive officer Joseph Petrowski said that he will become Group CEO of Cumberland Farms-Gulf Oil.

Petrowski will report to a nine-person board made up of five independent members and four Haseotes family members with Lily H. Bentas, who is currently CEO of Cumberland Farms, as chairperson. Ari Haseotes, [image-nocss] currently vice president of marketing for Cumberland Farms, will become president of Cumberland Farms Retail. Ron Sabia, currently chief operating officer at Gulf Oil, will become president of Gulf Oil.

The changes will be effective October 1, 2008.

"The move is being undertaken so that we can leverage the retail and real estate capabilities of Cumberland Farms with the wholesale, distribution and hedging capabilities of Gulf Oil to capture advantages in the marketplace created by these very volatile times," Petrowski told CSP Daily News. "This closer cooperation will allow us to streamline and coordinate more effectively our marketing, real estate, finance, IT and human resource functions."

Bentas has been involved with Cumberland Farms most of her life, continuing and growing the family business that began more than 50 years ago by her parents, Vasilios and Aphrodite Haseotes. During the 1970s and 1980s, she spearheaded acquisitions and financing activities to expand the company's convenience store and petroleum facilities, including the 1986 acquisition of the Northeast marketing and distribution assets of Gulf Oil from Chevron USA. In 2003, she announced another chapter of growth for Cumberland Farms, expanding its branded retail petroleum business in the Northeast by acquiring more than 200 Exxon-branded stations from ConocoPhillips.

Gulf bought the delivery contracts for more than 500 company-owned and franchised Exxon stations in 2003 after they were divested following the merger of Exxon and Mobil. A fuel wholesaler and New England's only major locally owned gasoline brand, Gulf switched 11 stations it operates on the Massachusetts Turnpike to Gulf from Exxon. It plans to switch another 158 Exxon-branded stations in New York and New England owned by Cumberland Farms to Gulf. Gulf supplies gasoline to another 300 Exxon stations in the region. It expects about two-thirds of those stations to operate under the Gulf flag.

Gulf 's ongoing strategy is to grow its current network of about 1,800 Gulf-branded and about 600 Exxon-branded locations to “well over 2,500 and close to 3,000 stations over the next five years,” Petrowski said late last summer. “Not only are we going to grow the number of sites, but also we 're hoping to have better sites.”

Gulf and Cumberland Farm's management re-imaging is going on while Gulf Oil is transforming its retail identity. Almost exactly one year ago, it unveiled its new Gulf Sunrise Gasoline & Retail Centers concept featuring the Gulf Express c-stores.

Newton, Mass.-based Gulf Oil—owned by the Haseotes family, which also owns the Cumberland Farms chain, one of Gulf 's biggest customers—is a totally downstream company that distributes motor fuels through a network of more than 2,400 branded stations, 12 proprietary oil terminals and a network of more than 50 other supply terminals.

Canton, Mass.-based Cumberland Farms operates a network of approximately 900 retail stores, gas stations and a support system including petroleum, dairy and grocery distribution operations.

Click hereto view CSP Daily News coverage of Gulf Sunrise.

Click herefor coverage of Gulf's plans to refresh its brand.

And click the Download Now button below to read Petrowski's recent Wall Street Journal opinion piece, "A Bipartisan Fix for the Oil Crisis."