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DALLAS -- A deal that will net Alon USA 102 FINA branded convenience stores builds on the company's base strategy of integration, according to Jeff Morris, president and CEO of Alon USA. The petroleum refining company that also operates 206 Southwest Convenience Stores signed agreements to acquire Abilene, Texas-based Skinny's for about $70 million.
The agreement came as part of a long-standing relationship between the companies. "We've been doing business [with Skinny's] for decades from our Big Spring refinery. We've fed them fuel for 10 to 15 years," Morris told CSNews Online. When Joe (Davis, president and CEO of Skinny's) reached a choice to investigate the market, he gave us a call and made it clear that there was a deal to be done. I think we struck a deal that's good for both."
Once the acquisition closes in the second quarter of 2007, the Central and West Texas stores will be converted to the 7-Eleven brand. "There's some real value in 7-Eleven. This allows us to implement the brand and value in all the stores," said Morris.
Alon's Big Spring refinery -- located about 80 miles from the stores -- will supply fuel to the stations, and with it will support the stores, sustain integration, and also give a secure outlet for the refinery, Morris added. Of the stores, approximately two-thirds are owned and one-third are leased, according to the company.
The FINA branded stores are classic 1,500 to 2,000-square-foot models with traditional offerings such as cold beverages, cigarettes and candy, according to Morris. After the stores are rebranded to 7-Eleven and offerings such as Slurpees are added, there could be the addition of foodservice, Morris said.
"We are considering adding a foodservice program to Southwest Convenience Stores and we would consider adding it to these stores as well," Morris told CSNews Online. The stores "give us solid corners, good real estate, good and loyal customers," he noted.
"We are excited about the opportunity to join the Alon team under the 7-Eleven brand," said Davis. "Our cultures are founded on the same premise of serving the customer. Both of our companies are proud of our West Texas heritage and we at Skinny's appreciate joining an organization that has operated the Big Spring Refinery for over 75 years. We are confident that our 102 stores will be a strong addition to Alon's existing 206 locations."
"It's always great to make a deal with someone you know and respect like Joe Davis," Morris concluded.