- 7-Eleven on Sunday announced that it has entered into an agreement to acquire convenience store Speedway from Marathon Petroleum Corp. for $21 billion in cash, according to a company press release.
- 7-Eleven will acquire around 3,900 Speedway stores in 35 states as part of the agreement. The retailer will also bring into the company approximately 40,000 Speedway employees.
- The transaction is expected to produce compound annual growth in 7-Eleven's operating income and EBITDA of over 15% for the first three years following the acquisition, according to the company. The deal is expected to close in the first quarter of 2021.
At a time when most other retailers are shrinking, 7-Eleven is expanding.
7-Eleven, which currently has over 9,800 stores in the U.S. and Canada, will have nearly 14,000 locations as a result of the deal, resulting in a presence in 47 of the top 50 most populated areas in the United States.
"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," 7-Eleven CEO Joe DePinto said in a statement.
The size of the acquisition will also give the resulting c-store a chance to streamline and leverage supply chain operations. "[T]he combined company will be well-positioned to maximize efficiencies and optimize relationships with vendors and business partners," the company stated.
7-Eleven has recently been delving further into technological services and operations. In February, the c-store began testing a cashierless store at its headquarters in Irving, Texas, perhaps as a precursor to expand into Amazon Go's territory. It also launched mobile checkout in New York City stores a year ago, in a move that the company said was the first convenience store chain to develop its own "full frictionless payment experience" and has proved to be advantageous as the nation confronts a pandemic. Then in May, the company teamed up with Postmates, DoorDash and Favor Delivery to offer on-demand delivery as consumers search for alternative solutions to safely obtain essential products during COVID-19.
The c-store also recently expanded its Evolution Store concept to San Diego and Washington, D.C., after opening its first location in Dallas the previous year. Those stores go deeper into categories like prepared foods and beauty, with a further diversified food assortment, thus infringing on more traditional grocery retail market share.
With the deal, 7-Eleven also announced an expanded environmental initiative that includes targets to reduce carbon emissions, utilize more eco-friendly packaging, a reduction in the use of plastics, and a commitment to sustainable food supplies.