Casey’s General Stores, Inc. (Nasdaq: CASY) has announced an agreement to acquire Fikes Wholesale, Inc. and its chain of CEFCO Convenience Stores in an all-cash transaction valued at $1.145 billion. This amount includes $165 million in tax benefits, bringing the net after-tax purchase price to $980 million.
Founded in 1952, Fikes and its CEFCO brand have grown from a single filling station in Cameron, Texas, to a respected operator with stores across several states. Casey’s acquisition will add 198 retail stores and a dealer network to its portfolio, expanding its footprint to nearly 2,900 locations. The deal will notably enhance Casey’s presence in Texas with 148 additional stores and add 50 stores in Alabama, Florida, and Mississippi. The transaction also includes a fuel terminal and a commissary for Texas locations.
Darren Rebelez, Board Chair, President, and CEO of Casey’s, stated, “This acquisition aligns with our strategy to achieve top-quintile EBITDA growth and significantly advances our unit growth plan. The addition of these high-quality assets will strengthen our presence in Texas and the surrounding regions.”
Raymond Smith, President of Fikes and CEFCO, expressed enthusiasm about the acquisition, noting the strategic fit and shared values between the two companies. “We’re excited for CEFCO stores to join Casey’s and look forward to enhanced store offerings and opportunities for our employees.”
Rebelez added that the acquisition is expected to add value for Casey’s shareholders both in the near and long term, and be accretive to EBITDA in the current fiscal year. Casey’s anticipates $45 million in annual run-rate synergies from integrating kitchen installations in the newly acquired stores.
The transaction is expected to close in Q4 2024, pending customary closing conditions and regulatory approval. Casey’s is advised by BMO Capital Markets Corp. (financial advisor), Paul, Weiss, Rifkind, Wharton & Garrison LLP (legal counsel), and Cleary Gottlieb Steen & Hamilton (antitrust legal counsel). Fikes is advised by BofA Securities (financial advisor) and Bourland, Wall & Wenzel, P.C. (legal counsel).
