Alimentation Couche-Tard will significantly increase its presence in Europe with the acquisition of more than 2,000 service stations from the French oil company TotalEnergies for $4.5 billion.
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The transaction includes 1,195 stores located in Germany, 387 in the Netherlands as well as a 60% stake in 566 stores located in Belgium and 45 in Luxembourg.
“These are winning assets,” said Couche-Tard CEO Brian Hannasch during a conference call with financial analysts on Thursday.
The partnership with Couche-Tard “will make it possible to accelerate the transformation” of the service stations of TotalEnergies in these four countries “by maximizing their sales excluding petroleum fuels”, indicated the French group in a press release.
“The transformation of mobility is leading customers to change their uses at service stations,” said Patrick Pouyanné, CEO of TotalEnergies. This basic trend requires the development of new services and new activities, particularly in the shops. Service stations must become true customer service points, rather than simple fuel distribution points. This is why TotalEnergies is now calling on Couche-Tard and its recognized expertise in operating convenience stores backed by service stations.”
Nearly 5000 stations in Europe
The Quebec company’s European network will increase from 2,703 to 4,896 service stations. Note that Couche-Tard entered the European market in 2012 with the acquisition of the retail network of Norwegian oil company Statoil for US$2.6 billion.
Worldwide, the Couche-Tard network will now have more than 14,500 establishments (16,500 including licensed stores).
Couche-Tard had been in talks with TotalEnergies for “nearly two years,” Hannasch said. Recall that in January 2021, Couche-Tard had failed in its attempt to get its hands on the French giant Carrefour.
This purchase of assets from TotalEnergies is Couche-Tard’s largest transaction since its acquisition of US operator CST for US$4.4 billion, completed in 2017.
Couche-Tard is considering other very large purchases abroad
Friday’s $4.5 billion deal is largest since 2017
AFP photo
A TotalEnergies service station near Lyon, France. The Quebec multinational Couche-Tard might acquire others, in addition to the 2,200 it acquired, in whole or in part, on Thursday.
Alimentation Couche-Tard will spend more than $4.5 billion to get its hands on nearly 2,200 service stations from the French oil company TotalEnergies and stands ready to buy others.
The transaction announced Thursday concerns 1,195 stores located in Germany, 387 in the Netherlands as well as a 60% stake in 566 stores established in Belgium and 45 in Luxembourg.
“If we work well together, we will see later if there are other opportunities”, confided to the Journal Couche-Tard’s chief financial officer, Claude Tessier.
$8 to $10 billion for other purchases
Total operates nearly 16,000 service stations in more than 70 countries, including 3,500 in France and 4,500 in Africa.
“There is nothing specific at this time,” added Mr. Tessier. We will focus on integrating well [les 2200 stations acquises]. It won’t be an easy task. »
“We are able to make this transaction quite easily, noted Claude Tessier. It does not put us in a difficult situation. We still have 8 to 10 billion US dollars of capacity to make acquisitions. »
Couche-Tard’s European network will increase from 2,703 to 4,896 service stations. The retailer entered the European market in 2012 with the acquisition, for US$2.6 billion, of the stations of the Norwegian oil company Statoil. These now bear the Circle K sign, named following the American subsidiary of Couche-Tard.
“We will decide later whether to change the name Total, but it is a very strong brand in Europe,” said Mr. Tessier.
Worldwide, the Couche-Tard network will now include more than 14,500 establishments.
Couche-Tard had been in talks with Total for “nearly two years,” said company CEO Brian Hannasch. Recall that in January 2021, Couche-Tard had failed in its attempt to get its hands on the French group Carrefour.
Decline in sight
The sale price represents “15 years” of profit, argued TotalEnergies, stressing that the stations sold “will be faced with a loss of their fuel-related income, while electric vehicles will be recharged mainly at home or at work”.
Faced with this reality, Couche-Tard will strive in particular to increase food sales, said Mr. Hannasch.
The transaction with Total is the largest for Couche-Tard since its acquisition of US operator CST for US$4.4 billion in 2017.
In 2019, Couche-Tard had tried to buy the Australian Caltex for $7.8 billion, but the pandemic had thwarted its plans. And in 2020, its Japanese rival 7-Eleven pulled the rug out from under it with a US$21 billion bid for the American chain Speedway.
AND BREF
TotalEnergies
- US$281 billion income in 2022
- US$21 billion profit in 2022
- Over 100,000 employees
Food Couche-Tard
- US$71 billion income in 2022
- US$2.9 billion profit in 2022
- 122 000 employees
