Last updated on May 9th, 2016 at 09:34 am
San Antonio, Texas-based CST Brands, which is in the midst of exploring its strategic alternatives, said May 5 that it has agreed to sell its 79 stores in California and Wyoming to 7-Eleven and its wholly-owned subsidiary, SEI Fuel Services Inc. The transaction involves 76 stores in California and three in Wyoming.
The purchase price for the transaction is $408 million. The transaction is subject to customary closing conditions including possible purchase price adjustments at the time of close. The cash deal is expected to close mid-summer 2016.
With the closing of this transaction, CST expects to realize a tax benefit from the completion of a like-kind exchange strategy with its purchase of the properties that were acquired in Georgia and Florida as part of the Flash Foods network.
“These have been great performing stores, which is a tribute to our hardworking, dedicated employees,” said Kim Lubel, chairman, president and CEO of CST. “This is a tremendous opportunity for the right buyer and we look forward to working with 7-Eleven to close this transaction.”
Raymond James advised CST Brands in the transaction.
CST announced its exploration of strategic alternatives on March 3, saying it is seeking ways to further enhance stockholder value. As previously indicated, CST has formed a special committee of independent directors to oversee the process.
CST is a Fortune 500 fuel and convenience retailer. The company employs more than 14,000 team members at 2,000-plus locations throughout the southwestern U.S., Georgia, Florida, New York and Eastern Canada.
In the U.S., CST Corner Stores sell fuel and signature products such as Fresh Choices baked and packaged goods, U Force energy and sport drinks, Cibolo Mountain coffee, FC Soda and Flavors2Go fountain drinks. In Canada, CST is the exclusive provider of Ultramar fuel, and its Dépanneur du Coin and Corner Stores sell signature Transit Café coffee and pastries. CST also owns the general partner of CrossAmerica Partners LP, a master limited partnership and wholesale distributor of fuels, based in Allentown, Pennsylvania.