Casey's To Buy CEFCO Store Owner Fikes Wholesale In $1.145 Bln Cash Deal

(RTTNews) - Convenience store chain Casey's General Stores, Inc. (CASY) announced Friday an agreement to acquire Fikes Wholesale, Inc., owner of CEFCO Convenience Stores, in an all-cash deal for $1.145 billion.

The purchase price includes tax benefits valued at around $165 million for a net after-tax purchase price of $980 million.

The acquisition is anticipated to close during the fourth quarter of calendar year 2024, subject to customary closing conditions and regulatory approval.

Casey said its acquisition of Fikes will include 198 retail stores and a dealer network. The proposed transaction will increase Casey's footprint to nearly 2,900 stores.

The acquisition will bring 148 additional stores to Texas, a highly strategic market for Casey's, as well as 50 stores in the southern states of Alabama, Florida, and Mississippi.

The deal also includes a fuel terminal and a commissary to support the Texas stores.

The acquisition is expected to create value in the near- and long-term and will be accretive to Casey's EBITDA in the current fiscal year.

Darren Rebelez, Board Chair, President and CEO of Casey's, said, "During our Investor Day presentation in June of 2023, we outlined our business strategy to achieve top-quintile EBITDA growth. One of the core pillars of the plan is to grow the number of units. This acquisition will allow Casey's to accelerate our unit growth plan with high-quality assets that, along with our recent 22 store acquisition in northern Texas, will provide an expanded presence in Texas and allow us to continue to expand in the state and region."

The company plans to finance the deal through balance sheet cash and bank financing.

Casey's expects to achieve around $45 million in annual run-rate synergies upon the completion of kitchen installations in the acquired stores.