Parkland Fuel Corporation has announced the acquisition of Imperial Oil Limited (TSE:IMO, Mkt cap 37.21B, P/E 33.52, Div/yield 0.14/1.27, EPS 1.32, Shares 847.60M) On the Run / Marché Express convenience store franchise system, which will come with the real estate assets at 17 Esso-branded retail sites in Saskatchewan and Manitoba.
The agreement, which includes the franchise agreements for approximately 80 On the Run / Marché Express convenience stores, comes quickly after the announcement that Imperial is selling its remaining 497 Esso stations across Canada.
Imperial has been steadily selling-off its fuel stations, of which there are 1,700 across Canada, for several years on the back of the belief that it is the best way for the Calgary-based oil and gas company to grow in the highly competitive Canadian fuels marketing business.
Parkland believes it can profit from Imperial’s decision to get out of the retail gasoline business, with the purchase of the franchise and related trademarks providing it with a national convenience store brand to grow and enhance its convenience store offering.
“Parkland continues its strategy of being a disciplined acquirer that focuses on accretive opportunities that drive shareholder value. I am pleased that our team has successfully negotiated this purchase at an attractive valuation,” said Bob Espey, Parkland’s President and CEO.
He added that the acquisition hands Parkland a “tremendous opportunity”, paying tribute to On the Run / Marché Express’s “strong brand equity that resonates with customers.”
“The brand will enhance our focus on driving non-fuel sales growth in our existing network as we continue to work towards exceeding our customers’ expectations,” he explained.
Imperial Oil Limited a Calgary-based integrated oil company. Imperial is engaged in the exploration for, and production and sale of, crude oil and natural gas. The Company’s operations are conducted in three main segments: Upstream, Downstream and Chemical. Upstream operations include the exploration for, and production of, crude oil, natural gas, synthetic oil and bitumen. Downstream operations consist of the transportation and refining of crude oil, blending of refined products and the distribution and marketing of those products. Chemical operations consist of the manufacturing and marketing of various petrochemicals. The Company’s Chemical operations manufacture and market ethylene, benzene, aromatic and aliphatic solvents, plasticizer intermediates and polyethylene resin. More from Reuters »
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