DALLAS -- Sunoco LP has completed the acquisition of the retail convenience-store assets and wholesale fuel business in two states from Denny Oil Co. Inc. for approximately $53 million and is preparing to reimage the retail outlets.
The acquisition includes six company-operated locations and wholesale fuel supply contracts for a network of approximately 120 independent dealer-owned and dealer-operated locations and a commercial fuels business in the eastern Texas and Louisiana markets.
Sunoco will rebrand Denny Oil’s company-owned Check Point convenience stores to the Stripes brand, and the dealer locations will retain their current fuel brands through Sunoco’s wholesale branded-fuel marketer agreements. The stores are located in the metropolitan areas of Dallas and Houston, and in Louisiana. Denny Oil distributes approximately 90 million gallons of retail and wholesale fuel annually, primarily under the Exxon and Shell brands.
Nacogdoches, Texas-based Denny Oil, founded in 1972, has a group of “attractive, well-run assets in a geography where there will not be much geographic overlap with our current operating profile, and we are pleased to expand into the area,” Sunoco LP president and CEO Bob Owens said during the company’s second-quarter 2016 earnings call in August.
This acquisition strengthens, and in some cases establishes, Sunoco's existing convenience-store and wholesale fuel-distribution business in eastern Texas and Louisiana. Sunoco LP funded this transaction using amounts available under its revolving credit facility, and the company expects it to be immediately accretive to Sunoco with respect to distributable cash flow.
Santa Barbara, Calif.-based Corner Capital provided valuation and strategic merger and acquisition (M&A) advisory services throughout the process to Dick Rudisill and Denny Oil Co.
Dallas-based Sunoco LP is a master limited partnership (MLP) that operates approximately 1,340 retail fuel sites and convenience stores (including APlus, Stripes, Aloha Island Mart and Tigermarket brands) and distributes motor fuel to convenience stores, independent dealers, commercial customers and distributors located in more than 30 states at approximately 6,900 sites. Its parent, Energy Transfer Equity LP, owns Sunoco's general partner and incentive distribution rights.
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