Valero Energy Corp. spun off its retail segment into a new company, CST Brands Inc., which debuted on the New York Stock Exchange on May 1, 2013.
CST Brands has about 2,000 company-operated convenience stores and gas stations in the United States and Canada and more than 5,000 retail and branded-wholesale outlets in the United States, Canada and the Caribbean. Most of the U.S. company-operated stores do business under the name Corner Store and most sell Valero fuel.
In November 2014, the company closed on the acquisition of Nice N Easy Grocery Shoppes. CST will retain the Nice N Easy brand. CST Brands and CrossAmerica jointly purchased the assets of Nice N Easy, with CrossAmerica purchasing 23 fee sites, as well as certain fuel-distribution assets for $65 million. CST Brands purchased the retail operations at the 32 company-operated sites and certain other assets.
In 2014, CST planned to build about 30 new stores in the United States. The company sold about 100 stores, including 61 in Texas, as part of its network optimization plans. Also in 2014, the company purchased Lehigh Gas Partners general partner Lehigh Gas GP LLC, a master limited partnership (MLP), for $85 million.
Q2 2015 Update
In June, CST Brands, with partner CrossAmerica Partners LP, entered into a definitive agreement to acquire the One Stop convenience-store chain based in Charleston, West Virginia. The transaction includes 41 company-operated One Stop convenience stores, four commission-agent sites, nine dealer fuel-supply agreements and one freestanding franchised quick-service restaurant. Of the 45 company-operated and commission agent sites, 30 are owned in fee. Five of the company-operated locations have quick-service restaurants. For the year ended Dec. 31, 2014, the aggregate 54 sites sold approximately 36 million gallons of motor fuel primarily under the Marathon and Exxon fuel brands, and had approximately $40.5 million in inside sales.
Q1 2015 Update
CrossAmerica Partners LP closed on the purchase of all of the outstanding shares of Hudson, Wis.-based Erickson Oil Products Inc. and certain related assets for $85 million, subject to certain post-closing adjustments. Erickson operates 64 convenience stores in Minnesota, Michigan, Wisconsin and South Dakota, with a concentration in the Twin Cities. CrossAmerica intends to operate the Freedom Valu convenience stores, but expects to transfer the operation of certain sites over time to CST Brands Inc., the parent company of CrossAmerica’s general partner.
In late March, Joe Topper, chief executive officer and president of CrossAmerica Partners, announced his plans to retire as CEO effective Sept. 30, 2015, and resigned as president effective immediately. The new president, Jeremy Bergeron, who currently serves as senior vice president of integration and development for CST Brands, comes with nearly 20 years of experience with Valero and CST Brands. Topper will continue to serve on the boards of both CST Brands and CrossAmerica after he formally steps down as CEO.
In speaking with an industry analyst recently, senior management of CST Brands and CrossAmerica stated that they are currently looking at 20 deals in their acquisition pipeline and are targeting $150 million to $200 million in acquisitions a year, subject to market conditions. CST is also focused on organic growth, and plans to build 35 to 40 new locations in the United States this year, as well as 10 to 12 new locations in Canada.
|No. of Stores:||1900|
|Average Store Size:||2,500-4,000 sq. ft.|
|Rank Last Year:||3|
|States of Operation:||Arizona, Arkansas, California, Colorado, Louisiana, New Mexico, New York, Oklahoma, Texas, Wyoming, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, Quebec|