Casey’s General Stores has come out swinging as the newest player in the M&A game, bringing home a $1.145 billion acquisition last year of Fikes Wholesale, owner of CEFCO Convenience Stores, Temple, Texas.
The acquisition will give the convenience-store retailer 148 additional locations in Texas, a highly strategic market for Casey’s, as well as 50 stores in the southeastern states of Alabama, Florida and Mississippi. The 198-store CEFCO acquisition brings the chain’s total store count to approximately 2,900 stores.
In November 2023, Casey’s also acquired 22 Lone Star Food Stores in Texas that it purchased from W. Douglass Distributing Ltd., Sherman, Texas.
The Ankeny, Iowa-based Casey’s has historically focused strictly on building new-to-industry (NTI) stores in rural areas. Its Fikes acquisition is a significant departure, expanding into rural and metro markets with established stores. A spokesperson for Casey’s confirmed to CSP that its “store growth strategy continues to leverage both NTI and acquisition opportunities. We look forward to continuing to grow in new areas.”
“Casey’s is the one to watch since they have embraced the idea of acquisitions instead of nothing but new builds as they did in the past,” said Terry Monroe, president and founder, American Business Brokers & Advisors, Fort Meyers Beach, Florida. “With the acquisitions, they can grow faster and expand their territory, which they needed to do.”
New-to-industry (NTI) locations can take four-to-five years of planning and construction, Monroe said. Whereas with a 30-store acquisition, for instance, “you’re already making money every day,” he said.
In addition, many locations in markets new to Casey’s are already gone, locking the chain out of any significant penetration. And while these existing stores may not make as much money as some of Casey’s best NTI’s, they still hold considerable value.
“A lot of retailers are just mediocre operators, but they have a good location,” Monroe said. “If I’m a better operator, I can remodel the store or raze and rebuild and make a barn burner.”
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