Dive Brief:

• Convenience and fuel retailer Mountain Express Oil Co. has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of Texas, according to a Monday announcement.
• Mountain Express will undertake a “comprehensive restructuring” that’s intended to strengthen its retail segment, fuel distribution business and dealer network. All Mountain Express owned or affiliated c-stores, travel centers and fuel centers are expected to maintain normal operations during this time.
• The retailer’s bankruptcy filing comes about 17 months after it completed a $205 million debt financing to support its growth initiatives, which included reaching 100 company-operated stores by the end of 2021.

Dive Insight:

Shortly after Mountain Express completed its debt refinancing, the retailer acquired 100 locations in a matter of months. Between October 2021 and June 2022, it purchased the 50-store Brothers Food Mart chain in Louisiana; 24 locations from New Jersey-based Texon Oil Inc.; and the 26-unit The Store chain from Wisconsin-based Team Schierl Cos.

As it files for Chapter 11 bankruptcy a year and half later, in addition to its restructuring plan, Mountain Express is in advanced discussions with its secured lenders for debtor-in-possession financing. This will give Mountain Express additional liquidity so it can continue to pay its bills, according to the announcement.

“We continue to have a robust pipeline and will continue to provide opportunities for our dealers, partners and employees,” Turjo Wadud, co-CEO of Mountain Express, said in the announcement. “During this process, we intend to maintain the underlying durability of our business as well as our strong relationships in the industry.”

The retailer will use cash collateral, as well as normal operating cash flows — upon approval from the Bankruptcy Court — to fund its operations amid its bankruptcy filing, according to the announcement. It has filed customary motions with the Bankruptcy Court so it can continue paying employees and offering benefits, upholding its dealer and retail agreements and making fuel supplier and other vendor payments.

Additionally, Mountain Express will continue discussions with its financial stakeholders, including “critical conversations” with landlords to maximize value for all stakeholders.

Mountain Express did not respond by press time to an inquiry for more details on these discussions.

Founded in 2000, Alpharetta, Georgia-based Mountain Express Oil distributes fuel to 828 locations around the country, including 27 travel centers, and operates about 100 retail stores.