Arko Corp., parent company of GPM Investments, is planning to divest its convenience-store operations in a deal that could be valued at around $2 billion, according to a Reuters report.
Richmond, Virginia-based Arko is working with investment bank Citigroup to sell the package of about 1,500 c-stores that it currently operates, the sources said, requesting anonymity as the discussions are confidential. The company is looking to end its longtime retail expansion strategy amid a slowdown in sales, people familiar with the matter told the news agency.
Arko’s shares jumped nearly 14% on the news, before paring some gains to close at $6.65, giving the company a market value of about $770 million, said Reuters.
Potential buyers include other convenience-store operators, as well as private equity firms, who have submitted initial bids for the stores, the sources said, cautioning that a deal is not guaranteed.
The stores generate around $300 million of annual earnings before interest, taxes, depreciation and amortization (EBITDA), the sources said.
Arko would retain its fuel distribution business, the report said. The company believes it could achieve a higher valuation as a standalone fuel distributor, the sources said. Arko currently supplies fuel to more than 1,800 independent dealer sites and approximately 300 unmanned fleet fueling locations.
In response to a CSP request for comment on the possible sale, Arko said, “We are not going to comment on rumors.”
- GPM Investments is No. 6 on CSP’s 2024 Top 202 ranking of U.S. c-store chains by store count.
GPM Investments is a wholly owned subsidiary of Richmond, Virginia-based Arko Corp. It has more than 1,500 stores under more than 25 regional store brands, including Fas Mart, Li’l Cricket and Scotchman.
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