Dive Brief:
- Casey’s General Stores has agreed to acquire Fikes Wholesale, parent company of CEFCO Convenience Stores, for over $1.1 billion, the company said Friday.
- The deal includes 198 stores in Texas, Alabama, Mississippi and Florida, according to the press release. This will mark Casey’s entrance into the latter three of those states, according to Casey’s 2024 annual report.
- C-store M&A this year has focused more on smaller deals compared to 2023, but this is one of a handful of larger deals the industry has seen, alongside 7-Eleven acquiring 204 Stripes stores from Sunoco and H&S buying Andretti Petroleum Group’s 170 sites.
Dive Insight:
Casey’s leadership hasn’t been shy about the company’s growth plans, which, since last summer, have included bringing 350 more convenience stores to its network by 2026. During its investor day in June 2023, CFO Steve Bramlage said Casey’s had “ample liquidity to be opportunistic for potential acquisitions and remain nimble to continue to invest behind building new units.”
Since then, Casey’s notable acquisitions have included 63 Minit Mart and Certified Oil c-stores from EG America, as well as 22 c-stores in Texas under the Lone Star Foods Banner.
Its buyout of CEFCO, a well-known c-store retailer in the south, is not only Casey’s biggest single acquisition in nearly four years, but continues the company’s expansion in Texas and marks its arrival in Alabama, Mississippi and Florida.
The deal — expected to close during the fourth quarter of this calendar year — includes 148 stores in Texas, with the other 50 scattered across the other three states. Casey’s will also acquire Fikes’ fuel terminal and commissary to support the Texas stores.
“During our Investor Day presentation in June of 2023, we outlined our business strategy to achieve top-quintile EBITDA growth. One of the core pillars of the plan is to grow the number of units,” Darren Rebelez, chairman, president and CEO of Casey’s, said in Friday’s announcement.
Rebelez continued: “This acquisition will allow Casey’s to accelerate our unit growth plan with high-quality assets that, along with our recent 22 store acquisition in northern Texas, will provide an expanded presence in Texas and allow us to continue to expand in the state and region.”
Temple, Texas-based CEFCO is now leaving the c-store industry after 72 years in the business. Its exit comes during a difficult time for small and midsize c-store retailers, which have struggled in recent years to stay afloat amid rising operating and maintenance costs and credit card fees.
The retailer’s employees are expected to join Casey’s once the deal closes, Raymond Smith, president of Fikes and CEFCO, said in the announcement.
“I am happy that the CEFCO stores will join a top convenience retailer that will reinvest in the stores and eventually bring Casey’s pizza to many of our customers as well as provide professional opportunities for our employees,” Smith said. “We believe Casey’s will be an excellent steward of the CEFCO experience that our loyal customers have come to expect.”
Ankeny, Iowa-based Casey’s operates over 2,650 c-stores, mainly in the Midwest. Once the CEFCO deal closes, it will have nearly 2,900 locations.
