WESTLAKE, Ohio -- Picking up a group of convenience stores with high-volume fuel pumps that it says are in great physical and financial shape and more closely resemble travel centers than c-stores, TravelCenters of America LLC has agreed to acquire 31 Minit Mart locations for $67 million from Fred's Minit Mart LCC, Bowling Green, Ky.
Fred's Minit Mart is owned and managed by Fred Higgins. Higgins also is a past chairman of the National Association of Convenience Stores (NACS).
As reported in a Raymond James/CSP Daily News Flash, of the 31 stores, 28 are located in Kentucky and three are in Tennessee; 27 of the locations include the ownership of land and buildings, while four are leaseholds. The typical location includes 10 fueling positions and approximately 5,000 square feet of interior space offering c-store merchandise as well as some prepared foodservices.
During 2012, these stores dispensed an aggregate of 38 million gallons of fuel.
"The 31 c-stores TA has agreed to acquire are high-volume fuel locations with larger interior space for merchandise and food offerings than typical c-stores and appear to have limited need for near-term capital investment. In addition, we do not expect these c-stores to require a lengthy period to achieve stabilized financial results," said Thomas M. O'Brien, TA's president and CEO. "We also expect TA may be able to realize synergies in purchasing and merchandising customer offerings at these c-stores which may make the financial results, relative to the acquisition cost, similar to that expected for travel center acquisitions. Nearly all of TA's existing travel centers currently offer gasoline for motorists, and most of these c-stores' customer offerings are similar to the products and foodservices available at our highway travel centers."
He added, "TA's principal business focus is and remains operating and expanding its nationwide network of large, full service travel centers along the U.S. Interstate Highway System that serve the U.S. trucking industry."
Fred Higgins and his father Ralph founded Minit Mart in 1967, according to the company's website. In 1972, Minit Mart Foods was incorporated with 16 stores. It was among the first c-stores to add gasoline dispensers, it said.
In 2001, Minit Mart Foods leased its operations to Clark Retail, retaining ownership of the assets. Besides operating its original 600 stores, Clark also acquired several other chains in the Midwest area, growing to approximately 1,200 stores. Competition, however, was intense, and Clark eventually ended up in bankruptcy in 2003, and 37 stores reverted to Higgins, who set up Fred's Minit Mart LLC with 34 remaining stores.
Today, the locations are a combination of convenience and grocery shopping while featuring Marathon gasoline; 24 of the stores offer O'Deli's sub shops and Godfather's Pizza.
When reached by CSP Daily News, Higgins declined to comment on the deal because of Securities & Exchange Commission (SEC) restrictions. Higgins said he will stay involved in the industry he loves to sell some remaining real estate. He intends to remain active in some capacity in industry organizations and to attend industry events. "It's an industry full of characters--of good characters. You get to know them, and you look forward to visiting with then and catching up on what they're doing. It's a great collection of entrepreneurs," he said.
Raymond James served as financial advisor to Minit Mart for the transaction. The deal's $67 million price tag is before closing costs and customary working capital adjustments.
Westlake, Ohio-based TA primarily operates and franchises travel centers under the Travel Centers of America, TA, Petro Stopping Centers and Petro brand names and offers diesel and gasoline fueling, restaurants, truck repair facilities, stores and other services. TA's nationwide business includes locations in 42 U.S. states and in Canada.