Mountain Express Oil Co., which filed for Chapter 11 bankruptcy protection in March, is negotiating a sale to Arko Corp., parent of GPM Investments, according to legal filings CSP Daily News obtained and as first reported by C-Store Dive.
U.S. Bankruptcy Judge David Jones told Mountain Express Oil Co. this week to use its cash collateral to continue paying ExxonMobil, bp, Sunoco, Gulf and other fuel suppliers so it can keep its business running while it negotiates details of the sale, the court filings indicate.
Other fuel suppliers to Alpharetta, Georgia-based Mountain Express named in the document include Chevron Products Co., HF Sinclair Refining and Marketing, Marathon Petroleum, Equilon, Valero Marketing & Supply and CITGO Petroleum.
After purchasing about 100 convenience store during the past two years, Mountain Express sought Chapter 11 bankruptcy protection in March and attempted to reorganize its operations. It hired investment banking bank Raymond James & Associates to sell some of its assets, and the firm contacted 121 potential buyers and pursued a sale but didn’t find a buyer interested in acquiring and continuing to operate the diversified company, a legal filing said.
Raymond James held an auction in July and August, and Arko emerged with a successful bid of about $50 million, a fraction of the $150 million Mountain Express Oil had hoped to receive, said Jayson Ruff, a trial attorney with the Office of the U.S. Trustee.
A spokesperson for Richmond, Virginia-based Arko said he couldn’t provide any information on the acquisition, which hasn’t been completed.
Legal filings indicate Arko is interested in purchasing Mountain Express’ assets, including leased retail locations and fuel supply agreements with about 800 c-stores and fuel stations. The parties are in mediation to negotiate details related to the transaction.
“If the sale doesn’t continue, they will try to get a trustee appointed. It could go to a wind-down and a liquidation,” Ruff told CSP Daily News.
“If they could sell it, the business could at least continue. The buyer would assume the contracts, pay the producers and continue the business,” Ruff said.
Mountain Express has a network of 166 company-owned convenience stores and 300 dealer-owned customers, including many family-operated small businesses. The company employs about 600 at its company-owned convenience stores and travel centers, according to legal filings.
After a management buyout and subsequent debt recapitalization in 2020, Mountain Express began growing its retail business through acquisition. In 2021, it acquired 50 locations from New Orleans-based Brothers Food Mart, 24 retail locations from Medford, New Jersey-based Texon Oil and six c-stores from Lakewood Ranch, Florida-based West Hill Ranch. In 2022, it acquired 24 The Store locations based in Stevens Point, Wisconsin.
In March, when Mountain Express Oil Co. filed for voluntary protection under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas, it said it intended to achieve a comprehensive restructuring and continue to conduct business throughout the process. Mountain Express’ owned and affiliated fuel centers, travel centers, c-stores and retail operations would maintain normal operations, the company said.
Mountain Express Oil didn’t immediately respond to CSP Daily News’ requests for comment. The court docket documents pertaining to Mountain Express Oil Co. are available at http://www.kccllc.net/mountainexpressoil.
- GPM Investments is No. 6 on CSP’s 2023 Top 202 list of the largest c-store chains by store count. Mountain Oil Express Oil is No. 50.
Based in Richmond, Virginia, Arko owns and operates numerous c-store brands, including Fas Mart, Shore Stop, Scotchman, BreadBox, Young's, Li'l Cricket, Next Door Store, Village Pantry, Apple Market, Jiffi Stop, Admiral, Roadrunner Markets, Jiffy Food Marts, E-Z Mart, 1 Stop, TownStar, ExpressStop and Handy Mart, among others. Arko has acquired two other companies so far this year, WTG Fuels Holdings LLC, which owns Uncle’s Convenience Stores and Gascard fleet fueling operations, and Transit Energy Group, which supplies fuel, operates a transportation business and owns about 135 c-stores with banners including Corner Mart, Dixie Mart, Flash Market, Market Express and Rose Mart.