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Mergers & Acquisitions

Kroger Sells C-Stores to U.K.-Based EG Group

$2.15 billion deal includes 762 convenience stores in 18 states

CINCINNATI and BLACKBURN, U.K. --The Kroger Co. and EG Group, a privately held petro forecourt convenience-store retailer based in Blackburn, Lancashire, United Kingdom, have announced a definitive agreement for the sale of Kroger's c-store business unit, including 762 stores, to EG Group for $2.15 billion.

The companies expect to close the transaction during the first quarter of Kroger's fiscal year.

As part of the agreement, EG Group will establish its North American headquarters in Cincinnati and continue to operate the c-stores under the established banner names.

Kroger announced in October 2017 its intention to explore strategic alternatives for its c-store business, including a potential sale, in conjunction with its Restock Kroger initiative.

Kroger's c-store business operates 785 c-stores in 18 states. It includes 66 franchise operations. The stores employ 11,000 associates and operate under the following banner names: Turkey Hill, Loaf 'N Jug, Kwik Shop, Tom Thumb and Quik Stop.

Kroger's c-store business generated revenue of $4 billion, including selling 1.2 billion gallons of fuel, in 2016.

Kroger's supermarket fuel centers and its Turkey Hill Dairy are not included in the sale.

Cincinnati-based Kroger has 2,793 retail food stores under a variety of banners in 35 states and the District of Columbia. It has 2,258 pharmacies, 307 fine jewelry stores, 222 retail health clinics, 1,472 supermarket fuel centers and 38 food production plants in the United States.

Founded in 2001 by brothers Zuber and Mohsin Issa, EG Group is a leading petro forecourt retail convenience operator that has established partnerships with global brands such as Esso, BP, Shell, Carrefour, Louis Delhaize, SPAR, Starbucks, Burger King, KFC, Greggs and Subway.

The EG Group employs more than 12,500 staff working in more than 2,600 sites across various European markets, including the United Kingdom, France, The Netherlands, Belgium, Luxembourg and Italy. In 2017, the business secured about 1,000 petro forecourt assets from Esso in Germany, which will be transferred and integrated into the existing network in fourth-quarter 2018. With the inclusion of the Kroger assets, EG Group will own and operate about 4,400 sites across Europe and the United States.

Watch for details in CSP Daily News.

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