According to the American daily, the two chains are in talks to combine their assets, which include BP gas stations, roadside Starbucks cafes, Circle K and Couche-Tard convenience stores, Cumberland Farms grocery stores and more.
These discussions could triple the number of businesses operated by the Quebec company, which already administers 7,000 businesses in Canada, the United States and elsewhere abroad.
The talks have so far failed to lead to an agreement – and they may never succeed, says the Wall Street Journal. But if the two companies were to unite, the turnover of the new group would climb to 70 billion US dollars thanks to the operation of approximately 21,000 gas stations, convenience stores, grocery stores and other fast food outlets.
The merged company – which would retain its head office in Laval, according to the daily – would combine EG Group’s network in the UK, Western Europe and Australia with that of Couche-Tard in the US, Canada, Northern Europe and a few other countries.
Tight negotiations
Proposals exchanged in recent weeks would value the British retailer at around US$16 billion or more, including debt, according to sources cited by the wall street journal.
The value of Couche-Tard is estimated at around $50 billion.
The two companies are engaged in tight negotiations, according to the sources of the New York daily. Their leaders, he said, have been blowing hot and cold in recent weeks.
Competitors who know each other
Couche-Tard was founded in 1980, when Alain Bouchard, who remains president, opened a first convenience store in Quebec.
The company then acquired several Canadian convenience store chains in the 1990s before launching an assault on the United States and Europe, starting in 2001. It notably bought Pantry Inc., owner of Kangaroo stores Express, in 2015.
The retailer also acquired Statoil Fuel & Retail’s convenience stores and gas stations in Europe in 2012. At that time, it was the largest acquisition in the company’s history, at 2 .8 billion US dollars.
But Couche-Tard has also suffered setbacks. In 2010, for example, its unsolicited takeover bid for Casey’s Retail Co. was rebuffed.
In 2020, the Quebec company also bit the dust by wanting to acquire the chain of convenience stores Speedway, which had opted for a more profitable offer submitted by a Japanese conglomerate.
And last year, the French government canceled its nearly C$25 billion deal with grocer Carrefour SA.
Alain Bouchard is the founder and executive chairman of the board of Alimentation Couche-Tard.
Photo: The Canadian Press/Ryan Remiorz
EG Group, for its part, is controlled by brothers Mohsin and Zuber Issa – billionaires – as well as private equity firm TDR Capital.
The business, originally called “Euro Garages”, was founded in 2001. It merged with a Dutch convenience store chain owned by TDR in 2016 and continued to expand by buying the U.S. chain’s UK operations. Kroger supermarkets and Esso’s Italian gas stations.
In 2019, it also got its hands on Cumberland Farms grocery stores – which Couche-Tard also had in its sights.
Always according to wall street journalEG Group is also participating in an auction to acquire the British pharmacy chain Walgreens Boots Alliance Inc. The company could fetch a price of around 10 billion US dollars.
Reference-ici.radio-canada.ca