Mergers & Acquisitions

Imperial Oil Evaluating Esso Model

Assessing transition of remaining company-owned sites to branded wholesaler model

CALGARY, Alberta -- Imperial Oil Ltd. is evaluating the potential transition of its remaining company-owned Esso retail gas stations to a branded wholesaler operating model, it said. It will also evaluate the growth opportunities for the On the Run convenience store brand.

Imperial Oil Esso (CSP Daily News / Convenience Stores / Gas Stations)

Under the branded wholesaler operating model, Imperial supplies fuel to independent third parties who own or operate the sites in alignment with Esso brand standards.

Approximately two-thirds of Imperial Oil's 1,700 Esso-branded gas stations in Canada operate under the branded wholesaler model. The remaining 500 sites are company owned and will be part of this evaluation.

This evaluation will include a non-binding bid process, which will begin in the coming weeks, said the company.

"Esso has a long, successful history as a leading retailer of high-quality fuels," said Brad Merkel, vice president of fuels and lubricants at Imperial Oil. "This evaluation will determine if strategic investments, through new business partnerships, can fuel further growth of the Esso brand in Canada."

Prospective buyers could include current or potential branded wholesalers who are aligned with Imperial Oil's intention to continue to grow the Esso brand.

"Regardless of the outcome of this evaluation, consumers will still be able to purchase the same high-quality fuel and lubricant products and can continue to expect the same superior buying experience at Esso service stations," the company said in announcing the evaluation.

ExxonMobil owns approximately 70% of Imperial Oil. In April 2009, Laval, Quebec-based Alimentation Couche-Tard Inc. acquired the On the Run franchise system, made up of approximately 450 convenience stores, from Exxon Mobil Corp., Irving, Texas.

Calgary, Alberta-based Imperial Oil is an integrated energy company. It is Canada's largest petroleum refiner, a major producer of crude oil and natural gas, a key petrochemical producer and a leading fuels marketer.

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