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SAN ANTONIO -- Valero Energy Corp.'s board of directors approved the spinoff of its retail business, to be named CST Brands Inc. The oil company stated in a news release it expects to spin off 80 percent of its equity in CST Brands on May 1.
CST Brands will operate nearly 1,900 convenience stores and gas stations, including 1,032 in the United States. The retail locations are expected to maintain their current Valero Corner Store operating banner.
"We believe the separated retail business will perform well and unlock value for our shareholders," Valero Chairman and CEO Bill Klesse said during the company's 2012 fourth-quarter earnings call in January. "In addition to its large and geographically diverse network of high-quality sites, the retail business has a long history of strong brand recognition and financial performance, as well as significant growth opportunities in merchandise, foodservice and new-build locations."
San Antonio-based Valero will retain a 20-percent interest in CST Brands for six months after the distribution and divest that interest as market conditions warrant, according to its news release.
Valero first announced plans to spin off its retail division last year. Initially, the oil company considered naming the retail spinoff Corner Store Holdings Inc., but reportedly decided to shorten its name.
Valero shareholders will receive one share of CST Brands for every nine Valero shares held as of April 19.