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KNOXVILLE, Tenn. -- Pilot Travel Centers LLC yesterday announced plans to purchase 60 retail travel centers owned by Nashville, Tenn.-based Williams TravelCenters Inc. for $190 million.
Knoxville, Tenn.-based Pilot, which operates the nation's largest travel-center network, said it has signed a definitive agreement to purchase the centers, including fuel inventory, merchandise and supplies. The sale is expected to close in 60 days, subject to government approval, the companies said in a statement.
"These are outstanding properties that will make a significant contribution to our operation," said Jimmy Haslam, president and CEO of Pilot Travel Centers LLC. "This enlarges our locations to almost 300 and gives us a broader coverage area in the U.S."
Pilot Travel Centers is a joint venture owned by Pilot Corp. and Marathon Ashland Petroleum. Pilot and Marathon each own 50 percent. When the deal closes, the venture would operate 296 centers in 37 states.
In addition to its ownership of Pilot Travel Centers LLC, Pilot Corp. operates about 70 convenience stores in Tennessee and Virginia.
Williams TravelCenters is a subsidiary of troubled energy giant Williams, a $36-billion energy company based in Tulsa, Okla. The company manages and markets a variety of energy products, including natural gas, liquid hydrocarbons, petroleum and electricity.
The Williams units were acquired in a 1998 merger with Mapco Inc. and were the company's only retail-oriented service, accounting for less than 1 percent of the company's business. Kelly Swan, a Williams spokesman, told The Knoxville News-Sentinel the 60 travel centers sold to Pilot have been operating at a loss for the past year.
"This year we sold over $3.5 billion in resources," Swan said. "We are tightening our business focus and raising cash to pay debts."
The company's stock has been in a "tough spot" for a year, Swan said, adding the company plans to focus on natural gas operations.
Pilot officials are confident they can return the locations to profitability, Haslam said. He said the size of the facilities' diesel and gas operations, as well their locations and retail operations, are an "excellent addition" to Pilot. Williams TravelCenters has about 2,000 employees, which combined with Pilot's existing operations gives the company approximately 12,500 employees.
Haslam said Pilot is continually looking to grow and expand the business, both through acquisitions and new construction.
The Williams centers are in 15 states from Arizona to Florida but concentrated in the Ohio Valley and the southeastern United States. The company plans to retain all of the Williams employees, the companies said.
"We look forward to integrating the Williams locations and store employees within Pilot Travel Centers," Haslam said.