CrossAmerica Finalizes Acquisition of Assets From Community Service Stations
The $27.5M deal includes fuel supply contracts for roughly 75 million gallons annually.
ALLENTOWN, Pa. — CrossAmerica Partners LP completed its acquisition of certain Community Service Stations Inc. (CSS) assets for $27.5 million, plus working capital, on Nov. 10.
The transaction included wholesale fuel supply contracts to 38 dealer owned locations, 35 subjobber accounts and two commission locations, one fee based and one lease. The supply contracts include approximately 75 million gallons of fuel annually through fuel brands such as Exxon Mobil, Shell, Gulf and others.
The deal was announced in August, as Convenience Store News previously reported.
Boston-based CSS was founded in 1918 by George Riley Sr. and his business partner Paul Strang. They started with a single service station that offered auto repairs and motor fuels. Over the next few decades, the company expanded its fuel offerings into home heating oil and kerosene, constructing one of the first bulk heating oil and kerosene distribution depots in the suburbs west of Boston.
Riley Sr.'s son, George C. Riley Jr., succeeded him as president and held the title for 66 years, during which time he tripled the company's fuel volumes. In 1979, Riley Sr.'s grandson Chris Riley joined CCS and currently serves as president.
As the industry shifted toward a convenience store-based model, CSS was one of the first Mobile branded distributors to encourage independent dealers to rebuild outdated repair bay sites into convenience stores. Under Riley's leadership, the company's fuel volume continued to significantly increase, and in 2011, CSS became one of four exclusive fuel distributors authorized and licensed by ExxonMobil to distribute Mobil and Exxon branded motor fuels in New England.
CrossAmerica's acquisition of CSS assets was financed with cash on hand and undrawn capacity under its revolving credit facility. It expects the acquisition to be immediately accretive to distributable cash flow to limited partners.
"It was not an easy decision to sell the company that we had built over the past century. The Matrix team provided professional guidance and advisory expertise throughout the entire process and were truly instrumental in securing a successful outcome," Riley said. "CrossAmerica was a natural fit as a buyer for CSS as they share our long tradition of excellence and strong commitment to their customers and employees."
Matrix Capital Markets Group Inc. provided merger and acquisition advisory services to CSS.
"We are excited to acquire these attractive assets from one of the leading wholesale distributors in the Boston area," said CrossAmerica Partners President and CEO Charles Nifong when the deal was announced. "This acquisition expands our fuels business in the New England market with new dealers and strengthens our relationship with several of our major fuel supplier partners."
Formed in 2012, CrossAmerica Partners LP is a distributor of branded and unbranded petroleum for motor vehicles in the United States and distributes fuel to approximately 1,750 locations and owns or leases approximately 1,150 sites. Its footprint covers 34 states.