Dive Brief:
- CrossAmerica Partners and its subsidiary Lehigh Gas Wholesale Services, Inc. have agreed to acquire 59 c-stores from Applegreen Midwest LLC and Applegreen Florida for $16.9 million, according to a Friday SEC filing.
- The stores will change hands via the termination of existing lease agreements between the two companies. CrossAmerica also will acquire the inventory at each location for cash, according to the SEC filing.
- This deal comes several years after the two companies forged a partnership to bring over 60 Applegreen-operated CrossAmerica convenience stores to Florida.
Dive Insight:
When CrossAmerica entered into master fuel supply and master lease agreements with Applegreen in late 2018 for the Florida stores, the Pennsylvania-based company viewed the partnership as “an investment for the long-term,” former CrossAmerica CFO Evan Smith said at the time.
The initial agreement included 43 c-stores with plans to have 60 locations by the end of that year. This expanded upon the two companies’ existing partnership, which already included about 20 locations in the Northeast, former CrossAmerica President and CEO Gerardo Valencia said in 2018.
“I can tell you that we have seen that they were able to grow volumes at those sites by double-digits since they’ve been operating the sites, and they’re making sure that these sites are competitive,” Valencia said during CrossAmerica’s second-quarter earnings call in 2018 with regards to the Applegreen partnership.
About six years later, CrossAmerica and Applegreen are ending those lease agreements. The deal is expected to close in the first half of 2024.
The deal comes nearly three years after CrossAmerica acquired 106 c-stores from 7-Eleven in 2021. The company also acquired the fuel supply contracts from fuel wholesaler Community Service Stations for $27.5 million in 2022.
A spokesperson from CrossAmerica Partners did not respond by press time to an inquiry for details on the acquisition, which was officially agreed upon on Jan. 26.
Dublin, Ireland-based Applegreen has over 200 convenience stores in the U.S. across the Midwest and Northeast.
Allentown, Pennsylvania-based CrossAmerica Partners operates more than 250 convenience stores across 10 states. The company also distributes fuel to about 1,700 locations in 34 states.
