Mergers & Acquisitions

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>>> Casey's General Stores to Buy Fikes Wholesale for About $1.15B


MarketWatch

July 26, 2024

By Denny Jacob


https://www.marketwatch.com/story/casey-s-general-stores-to-buy-fikes-wholesale-for-about-1-15b-update-852c69af


Casey's General Stores agreed to acquire Cefco Convenience Stores owner Fikes Wholesale in an all-cash deal worth about $1.15 billion.

The convenience-store chain's acquisition would include 198 retail stores and a dealer network throughout Texas, Alabama, Florida and Mississippi, which will increase Casey's footprint to nearly 2,900 stores. The transaction also includes a fuel terminal and a commissary to support stores in Texas.

Casey's Chief Executive Darren Rebelez said the acquisition expands its presence in the Lone Star State by bringing 148 additional stores to the area.

Expanding into Texas, Alabama, Florida and Mississippi extends its reach further from neighboring states such as Oklahoma and Tennessee. Casey's footprint is primarily concentrated in the Midwest, according to an investor-day presentation.

Casey's acquisition fits into a strategy laid out at its investor day in June 2023. The company guided for more than 350 additional stores to be built or acquired by fiscal 2026, putting it more than three-quarters of the way to its minimum goal.

The Fikes acquisition speaks to consolidation in the convenience-store industry that is facing declining tobacco sales, rising cost pressure and labor shortages.

Casey's said it expects to achieve about $45 million in annual run-rate synergies after kitchen installations in the acquired stores are completed.

The deal, financed through balance-sheet cash and bank financing, is expected to close in the fourth quarter.

Fikes and Cefco began as a single "filling station" in Cameron, Texas, in 1952 and grew to operate stores in multiple states.

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