KENT, Wash. -- One month after announcing it would purchase ConocoPhillips remaining 600 or so convenience stores in the Northeast, Pacific Convenience & Fuel LLC is working with lessee-dealers to seal the deal. The effort comes after a dealers' alliance questioned whether ConocoPhillips and Pacific had jumped the gun in announcing the before right-of-first-refusal waivers were approved.
"Dealers in Washington and California have a right of first refusal on all assets owned by ConocoPhillips at the locations they lease," Tim Hamilton, executive director of Automotive United Trades [image-nocss] Organization, McCleary, Wash., said shortly after the sale was announced in August. "ConocoPhillips must supply the current dealer with an offer to sell at that same price as offered to [Pacific Convenience & Fuel parent company PetroSun Fuel] and 30 days in which to exercise their rights prior to the sale to PetroSun."
Pacific Convenience & Fuel CEO Sam Hirbod told CSP Daily News he is going through that process now, as provided by law and the dealers' contracts.
"We are making a compelling offer to them in terms of freezing their rents for two years, giving them options of purchasing their site or signing a long-term lease," Hirbod said. "We're offering them assistance in trying to buy their site, if that's what they want to do. And if they don't want to sign on with Pacific, they don't have to.
"There's no obligation at all," he added. "If they choose to stay with ConocoPhillips, they will stay on the rent program that ConocoPhillips has [in place].… Since Conoco has already announced they're getting out of the dealer business, [once that lease expires], ConocoPhillips will market [those sites on] the open market as individual stations. Then [the dealers] have the option to match the best offer."
The concern from dealers was first raised in late August after Houston-based ConocoPhillips signed a definitive agreement to sell its remaining retail sites to independent petroleum-retail and convenience-store operator PetroSun Fuel, Kent, Wash., and its newly formed affiliate Pacific Convenience & Fuel LLC for a reported $800 million.
The deal includes stores in 10 states, including Washington and California, where lessee/dealers are given the right of first refusal for purchasing their stores. Hirbod said about 320 of the sites purchased were company-operated, the rest were operated by dealers.
The transaction remains subject to regulatory approvals. The closing date for the sale in Dec. 15.
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