DETAILS: Marathon nearly triples earnings to $3.4B, Speedway earns $732M
“This acquisition is a great strategic fit for Speedway, and consistent with our growth plan,” said Speedway President Tony Kenney in a news release. “These stores will enhance our existing network and expand our brand presence in a key growth market for Speedway.”
Speedway is a major employer in the region and already operates about 2,740 convenience stores in 21 states. Speedway has about 1,350 employees in Clark County and 33,820 workers nationally.
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Stefanie Griffith, a spokeswoman for Speedway, said the acquisition is not expected to have a significant impact on the company’s employment or operations in Enon and Springfield. Representatives from Petr-All Petroleum Consulting Corporation did not return calls seeking comment this week.
Still, the acquisition is a sign that Speedway will continue to be a player in an industry that has seen some consolidation, said Michael McDorman, president and CEO of the Chamber of Greater Springfield.
“(Speedway) has performed very well and we hope it will continue to perform well in the future,” McDorman said.
Having a company of Speedway’s size headquartered in Clark County is valuable both from an employment standpoint and for economic development, McDorman said. It’s a signal that the region can provide a skilled workforce and support a company that’s among the largest players in its industry, he said.
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“They’re very important to our economy and as we seek to grow our community again,” McDorman said. “They’re going to play an important role.
Speedway is a subsidiary of Marathon Petroleum Corp., based in Findlay, Ohio. The deal is expected to close in the third quarter this year. Griffith said the acquisition made sense because Speedway already operates 235 stores in the New York region, which has been identified as a key area of growth for the chain.
Speedway has grown significantly in just the past few years. In 2015, Speedway’s $2.8 billion acquisition of Hess nearly doubled the size of the chain. At that time, Speedway already operated about 1,500 stores in nine states, but the Hess acquisition expanded the company’s reach to more than 2,700 stores throughout the Midwest and East Coast.
The financial terms of the latest acquisition of the Express Mart stores was not disclosed.
In an interview with the News-Sun late last year, Kenney said the chain was poised for additional growth after its parent company rejected a proposal to spin off the retailer.
“Our objective is growth,” Kenney told the News-Sun in November last year. “That was one of the important aspects of the decision that was made. The evaluation of the spin-off was Speedway was going to continue to be an important part of Marathon and a growth part of Marathon. We’re looking for additional growth opportunities, both working organizationally and through acquisition opportunities. That’s going to be an important part of our strategy going forward.”
Company officials declined this week so say whether any further acquisitions are likely. Griffith said most Express Mart workers inside the store will become Speedway employees as soon as the deal closes.
“We are currently working with the non-store Express Mart employees located in New York on employment opportunities,” she said. “All store-level employees will be converted to Speedway immediately upon closing.”
RELATED: Marathon review of Enon-based Speedway could include spin-off
Company executives are expected to discuss Speedway’s latest finances during a conference call with investors early next month. Officials at Marathon have often credited the Speedway segment with providing reliable revenue for the company.
Marathon created a special committee last year to review the Speedway chain with the help of an independent financial adviser. The company had been under pressure to consider a spin-off after hedge fund Elliot Management Corp., one of the company’s largest shareholders, argued that Marathon’s stock was undervalued.
But after a lengthy review, Marathon’s board unanimously voted to keep Speedway under Marathon’s umbrella.
The Springfield News-Sun has provided award-winning coverage of Speedway and the convenience store industry. The paper has provided extensive coverage of a massive $2.8 billion acquisition of the Hess convenience store chain just a few years ago, as well explaining Speedway’s impact on the region’s economy.
By the numbers:
78 — New stores acquired
1,350 — Estimated Speedway workers in Clark County
33,820 — Estimated workers in the U.S.
2,700 — Estimated Speedway stores in the U.S.
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