Given the times we are living in you’d be forgiven for missing out on one of the busiest years ever for disposals and acquisitions. Property agents Christie & Co will tell us there is plenty of appetite from buyers to enter the sector or expand their existing networks. But, as always, if there are plenty of buyers there needs to be plenty of sellers.
As we started the year, Euro Garages announced the need to dispose of a number of sites to comply with CMA requirements, then a second batch was released in what appears to be estate management.
As much as fuel volumes and margins are important to EuroGarages, they put a higher value on the ability of a site to transition to a larger shop, food offers or both. I’m guessing that in their view many of the disposals can’t make that journey.
My old colleagues in Applegreen have come to similar conclusions and have decided to dispose of Petrogas UK. With their purchase of Welcome Break, this disposal looked inevitable. The level of investment needed to transform the Welcome Break business will be significant and the funds generated from the sale of Petrogas will help that cause, although
I do believe this network will offer plenty of value to the buyer who may also consider a switch of operating model.
MFG have been busy as usual with the purchase of the GeorgeHammond Group, a quality group of sites that will sit in their top drawer and make a significant contribution. The efforts by its parent company CD&R to purchase Morrisons would also suggest there is no shortage of confidence in the wider sector.
So regardless of the worldwide pandemic, it would appear the big boys are quietly getting on with their business, rationalising their estates and strengthening their balance sheet.
I think when planning your own strategy you would be foolish not to take note of their activity. Having walked the halls of two of the above, I can assure you they have better access to what the future holds and what it will look like. In their world strategy eats culture for breakfast.
If we can be of any assistance with planning your future strategy, please contact me and the team at Eurotank.
