Couche-Tard Acquires 40 Stores in the Midwest (U.S.)
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Alimentation Couche-Tard Inc. announces that it has, through an indirect wholly owned subsidiary, signed an agreement to purchase 40 stores and assume an additional 13 fuel supply contracts in the Midwest region. Should this transaction close as planned in March 2006, these acquisitions would add sales of approximately US $160 million to Couche-Tard's revenues and contribute to its earnings on an annualized basis. According to a confidentiality agreement between the parties, the purchase prices cannot be disclosed at this time. Internal cash flow dollars will pay for the transaction.
The 40 convenience stores and 13 fuel supply contracts are currently controlled by Shell Oil Products US. All 40 convenience stores and 13 fuel supply contracts are in the Indianapolis area. The 40 convenience stores are operated under the Shell banner with Shell motor fuel. The 13 fuel supply contract locations are also selling Shell motor fuel. Pursuant to this agreement, the company would buy the land and buildings for 29 convenience stores, would buy the land and lease the premises for one and would lease the other ten. The company would not have any fee or leasehold interests in the 13 fuel supply contracts but would have a fuel supply agreement with the 13 retailers to sell Shell motor fuel.
"Strategically, these acquisitions would be excellent complements to our current network in the Midwest and would efficiently complement the network expansion plans. Consistent with our development strategy, we selected these 40 stores based on the following criteria: prime locations, potential for growth and quality of people. Under our operation model and with the efficiency of our marketing programs, these 40 sites would contribute to improve profitability of the Division. Subsequent to these transactions, our network in the Midwest Division would include a total of 640 stores," indicated Darrell Davis, Vice-President Operations, Midwest Division.
Alimentation Couche-Tard Inc. is the leader in the Canadian convenience store industry. In North America, Couche-Tard is the third largest convenience store operator and the second largest independent (not integrated with a petroleum company) convenience store operator and the most profitable one within such category. Couche-Tard's network is currently comprised of 4,909 convenience stores, 3,028 of which include motor fuel dispensing, located in eight large geographic markets, including three in Canada and five, which cover 23 States in the United States. Some 36,000 people are employed throughout Couche-Tard's retail convenience network and executive offices.
For further information: Richard Fortin, Executive Vice-President and Chief Financial Officer, (450) 662-3272; Darrell Davis, Vice-President Operations, Midwest Division, (812) 379-9227; info@couche-tard.com, www.couche-tard.com.
