With deals ranging from individual stores to hundreds of locations, and assuming it finishes strong, 2023 looks as if it will go on to be a significant year of mergers and acquisitions in the convenience channel, as smaller chains are scooped up and larger retailers split up their retail assets between multiple buyers.
That makes the c-store industry a bright spot in the M&A market, where the number of deals across all industries are running at “subdued levels,” according to a PWC report released this fall.
A Convenience Store Insight report from Raymond James & Associates, however, shows the number of c-stores that changed hands through the third quarter has already surpassed full-year 2022 and stands about 400 stores short of topping full-year 2021. The year before that, in addition to being swayed by the pandemic, stands as an outlier as it includes the industry’s largest acquisition ever—7-Eleven Inc.’s purchase of the Speedway chain—making comparisons very challenging.
The report shows the most aggressive acquirers of the past decade have been 7-Eleven with about 5,000 stores acquired, Alimentation Couche-Tard/Circle K with about 2,500 stores purchased, EG Group with about 1,700 and Arko Corp. with about 1,200 stores acquired.
Meanwhile, retail gasoline margins in the United States remain generally inflated. Averaging about 36.5 cents per gallon in the second and third quarters of 2023, slightly about the five-year average, according to the Raymond James report.