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DALLAS -- Titan Global Holdings Inc., a diversified holding company that is in the process of acquiring convenience store operator Appalachian Oil Co. Inc. (APPCO), reached an agreement with an institutional investor to sell 17 APPCO properties for $15 million to the investor and simultaneously lease the properties back to be operated by APPCO under 20-year lease agreements with extension options.
Of the 17 properties, 13 are owned and operated by APPCO, while the remaining four are owned by APPCO and leased to third parties.
Meanwhile, Titan expects the APPCO acquisition to close on Sept. 12.
"I have extensive experience in the real estate leaseback space," David Marks, chairman of Titan Global Holdings, said in a statement. "In an effort to de-leverage the acquisition for Titan, strategic Titan investor Frank Crivello and I have structured a leaseback transaction with an institutional investor. We anticipate closing that transaction simultaneously with Titan's closing of Appco. This is a classic win-win transaction for the company, the institutional investor and ultimately for Titan shareholders."
In accordance with the APPCO purchase agreement, Titan will pay $30 million in cash for the stores and assume certain debts, the company stated. As a result of the sale-leaseback agreement, the acquisition of APPCO will be de-leveraged by reducing approximately half of the cash requirements to close the transaction, the company stated.