US subsidiary of Blackburn’s EG Group sells 63 stores in move to cut debts
An American subsidiary of Blackburn-based EG Group, is selling 63 of its convenience stores, for an undisclosed sum.
EG America is disposing of the stores to Casey’s General Stores Inc, in a bid to reduce group debts.
The stores are located in Kentucky and Tennessee, and currently operate under the Minit Mart and Certified Oil banners.
In March this year Casey’s General Stores bought 26 Minit Mart convenience stores from EG America for $48m.
EG America and Casey’s, two of the leading convenience store chains in the US, anticipate the deal will close later this year, subject to customary regulatory approvals.
Casey’s is expected to retain the staff at each of the stores it is purchasing, and EG America said it is cooperating to make their transition as seamless as possible.
Zuber Issa, co-founder and co-CEO of EG Group, said: “EG Group is pleased to have found a new home for some of our Certified Oil and Minit Mart portfolio.
“This divestment will enable both parties to execute their strategic plans, respectively. For EG Group, this divestment also represents another important step in executing our deleveraging strategy.”
Nick Unkovic, president of EG America, said: “We have built a strong and successful business over the years in these Certified Oil and Minit Mart stores, and we are proud of the hard work and dedication shown by our team members there.
“Casey’s is an excellent operator, and we are confident these stores and team members will continue to thrive under their ownership.”
Darren Rebelez, president and chief executive at Casey’s, said: “One of the key pillars in our strategic plan is to accelerate our store growth over the next three years and bring Casey’s to more communities.
“This opportunity is an excellent strategic fit as we look to add locations in Kentucky and Tennessee, which are both within our existing distribution footprint. We look forward to serving more guests in these markets and welcoming the team members from this transaction into the Casey’s family.”
EG Group operates approximately 1,800 convenience stores and petrol stations under various brands in North America.
Shortly before the March deal with Casey’s, EG Group entered into a $1.5bn sale-leaseback agreement with Realty Income Corporation under which the real estate investment trust will purchase up to 415 convenience store properties in the US.
EG Group co-founders and chief executives, Zuber Issa and Mohsin Issa, said: “Following completion of the transaction in Q2 2023, net proceeds will be used to repay debt and the business remains committed to a significant freehold underpin in the USA and globally.”
Last month EG published its latest financial results for the 2022 fiscal year which revealed a $258m pre-tax loss, against a $207m profit in 2021. This was despite achieving sales of $30.6bn, up from $26.420bn the previous year.
Casey’s is a Fortune 500 company operating more than 2,500 convenience stores.
Founded more than 50 years ago, the company has grown to become the third-largest convenience store retailer and the fifth-largest pizza chain in the US.
