Casey’s General Stores to acquire Fikes Wholesale for $1.15B in cash

Casey’s General Stores announced an agreement to acquire Fikes Wholesale, owner of CEFCO Convenience Stores, or CEFCO, in an all-cash transaction for $1.15B. The purchase price includes tax benefits valued at approximately $165M for a net after-tax purchase price of $980M. Casey’s acquisition of Fikes will include 198 retail stores and a dealer network. The proposed transaction will increase Casey’s footprint to nearly 2,900 stores. The acquisition will bring 148 additional stores to Texas, as well as 50 stores in the southern states of Alabama, Florida, and Mississippi. In addition to the retail stores and dealer locations, the transaction includes a fuel terminal and a commissary to support the Texas stores. The company plans to finance the transaction through balance sheet cash and bank financing. The net investment of $980M represents an approximate multiple of 11 times CEFCO’s pro forma adjusted 2023 EBITDA. The company expects to achieve approximately $45M in annual run-rate synergies upon the completion of kitchen installations in the acquired stores. The transaction is anticipated to close during the fourth quarter of calendar year 2024, subject to customary closing conditions and regulatory approval.