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WICHITA, Kan. -- Fuel Outlet Co., which closed at the end of last year due to mounting debt to investors and suppliers, is reopening under new management, the Wichita Business Journal reports.
Fuel Managers Inc., the Tulsa, Okla.-based firm that sells wholesale fuel in 40 states, has purchased the six Wichita and four Kansas City, Mo., Fuel Outlet locations. Terms of the deal were not disclosed. The new owner plans to have the Wichita locations open by the end of the week, says Neal Sweeney, vice president of operations.
The Wichita and Missouri Fuel Outlets are unmanned, automated gas stations that sell reduced-price gasoline.
As the only secured creditor of Fuel Outlet, Fidelity Bank foreclosed on the properties last year, according to the report. Denver-based Gary-Williams Energy Corp., which was a supplier for Fuel Outlet, hasn't received the $171,549 plus attorneys fees owed to it by eight of the nine Fuel Outlet locations.
Gary-Williams is one of many investors and suppliers who have lost money on Fuel Outlet, the report said. Gary-Williams filed a lawsuit, which was settled in an out-of-court agreement.
Paul Rosswork, senior attorney with Gary-Williams, told The Journal that since Fuel Outlet has been sold his company may try again to get its money back. "We're going to look into this further and see if there's money to be collected," he said. "But each Fuel Outlet has nothing left. Our debt is essentially worthless. We and all of the investors are basically out of luck."
Since many of the stores are unattended, gas prices at Fuel Outlet will be on the low end of other stores' prices, but won't be significantly lower. Customers who buy a prepaid card -- sold in Wichita by retail vendors -- are eligible for a minimum of two cents off per gallon. Eventually Fuel Outlet will sell to commercial fleet users, which will provide more money for the company.
Sweeney says the difference in management styles will also be key to Fuel Outlet's success. The former owners, he says, were more "labor intensive," meaning he used people to do things such as check when tanks were empty and change prices at each station. Sweeney says those things will now be automated, and people will only come to the stations to clean them and do routine maintenance.
"We'll be able to eliminate a lot of overhead by automating a lot of things," Sweeney said, adding Fuel Managers' experience in the industry will help company operations run more efficiently.