Speedway to pay $2.9B for Hess Corp. retail business
5/22/2014FINDLAY — Speedway LLC has agreed to pay $2.9 billion to purchase the retail business of Hess Corp, which includes more than 1,200 retail locations in 16 states.
Hess, based in New York City, is the largest convenience store operator on the East Coast. With the acquisition, Speedway will nearly double its retail presence, going from 1,480 stores in nine states to 2,656 stores in 26 states. Speedway is a subsidiary unit of Marathon Petroleum Corp. in Findlay.
Marathon CEO Gary Heminger said the acquisition will be “transformative” for the company.
"Our strategy is focused on growing higher-valued, stable cash flow businesses, and this transaction fully supports that objective,“ he said in a statement. ”With this significant geographic expansion, we will be able to further leverage our integrated refining and transportation logistics operations, providing an outlet for an incremental 200,000 [barrels per day] of assured sales from our refining system."
The deal with Hess also includes the company transport operations, including approximately 40,000 barrels per day on Colonial Pipeline, which stretches from Houston to New York.
Marathon said the combined business had 2013 revenues of $27 billion, sold 6.2 billion gallons of fuel, and $4.8 billion of annual merchandise sales. The company said Speedway will become the largest company-owned and -operated convenience store chain in the nation by revenue and the second largest by store count.