7-Eleven Transforms U.S. Store Network With 21B-Dollar Acquisition of Speedway
IRVING, TX - It seems as though cash rules everything around 7-Eleven this week as the premier retail and foodservice chain announced it has entered into an agreement to acquire Speedway for $21 billion. Purchasing the company from Marathon Petroleum Corp., 7-Eleven will acquire approximately 3,900 Speedway stores located in 35 states with its massive cash investment.
"This acquisition is the largest in our company's history and will allow us to continue to grow and diversify our presence in the U.S., particularly in the Midwest and East Coast," said Joe DePinto, President and Chief Executive Officer of 7-Eleven. "By adding these quality locations to our portfolio, 7-Eleven will have the opportunity to bring convenience to more customers than ever before."
According to a press release, Speedway and 7-Eleven have complementary geographic footprints with little overlap. 7-Eleven currently has over 9,800 stores in the United States and Canada and with Speedway's high-quality portfolio of approximately 3,900 stores, this acquisition will bring 7-Eleven's total number of stores to approximately 14,000 in the U.S. and Canada. Following the transaction, 7-Eleven will have a presence in 47 of the top 50 most populated metro areas in the U.S.
Speedway, with annual pre-synergy run-rate EBITDA of approximately $1.5 billion prior to the acquisition, is an exceptional business with significant opportunities for future growth. 7-Eleven expects to achieve $475 million to $575 million of run-rate synergies through the third year following closing, while maintaining financial flexibility and a strong balance sheet. Upon closing, 7–Eleven will be even better positioned to continue to pursue profitable growth opportunities.
7-Eleven and Speedway will also share best practices to deliver products and promotions based upon customer demand and continue both companies' legacy of innovation. In addition, the combined company will be well-positioned to maximize efficiencies and optimize relationships with vendors and business partners.
As noted in the release, 7-Eleven plans to form an integration steering committee with representatives from the leadership of both 7–Eleven and Speedway. Brand 7-Eleven will welcome the approximately 40,000 members of the Speedway team into the 7-Eleven family and integrate best practices of both companies.
Additionally, 7-Eleven reaffirms and expands the company's existing commitment to important environmental priorities as a part of its broader Environmental, Social, and Governance (ESG) efforts. Together, the combined company will set mutual and shared 2027 targets to reduce CO2 emissions, to utilize more eco-friendly packaging and sustainable food supplies, and to drive reduction in plastic usage. All of these measures will work together to enhance long-term corporate value.
The transaction is expected to be completed in the first quarter of 2021. As to whether the acquisition will drive fresh produce at the retail and foodservice chain is unknown, but we at AndNowUKnow will be sure to report.