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SEYMOUR, Ind. -- Kocolene Development Corp. is looking to transition out of the convenience store and gasoline business by merging with a roofing firm.
The Seymour, Ind.-based Kocolene announced plans to merge with Royalty Companies Inc., also of Seymour, and form a new holding company, Crown Investments LLC, according to a report by the Seymour Daily Tribune. Kocolene would own 90 percent of the new holding company, with Royalty owning the remaining 10 percent.
Robert R. Myers, Kocolene chairman and CEO, said his company can offer a lot of what Royalty needs, including strong management talent and capital to help it grow.
"At the same time, Kocolene is interested in transitioning out of the convenience store and gasoline business," Myers added. "We think the synergies will be very good."
Moving away from the convenience store and gasoline business will mean selling off many of its Fast Max stores and Kocolene gas stations operating in Indiana, Kentucky and Ohio. Kocolene operates 33 convenience stores, seven gas stations and 12 discount tobacco stores.
Only the most profitable are expected to remain part of Kocolene, and those for perhaps just three or four years, Myers said. They would be kept to provide cash flow to finance expansion of the Royalty subsidiaries. He was not able to say which stores might be retained.
Commercial roofing would be a primary target for Crown Investments, much as it is a key component of Royalty Roofing. The new venture wants to expand the business from its current 100-mile radius into the entire Midwest.
Another venture could see Royalty developing properties Kocolene now owns.