BLACKBURN, 9th November 2018 – EG Group announces petrol forecourt convenience expansion plans in Australia by entering into a binding agreement with Woolworths Group Ltd (ASX: WOW) for the sale of its 540 site network (“Woolworths Petrol”) for A$1.725 billion.
Woolworths Petrol operates a nationwide network of sites and employs circa 4,000 people. In the year to 30 June 2018, the business generated A$4.8 billion of revenue and sold 3.6 billion litres of fuel.
As part of the transaction, EG Group and Woolworths have entered into a 15 year commercial alliance covering loyalty, fuel discount redemption, and wholesale supply. Key features of the alliance include:
• Woolworths’ popular four cent per litre fuel discount will continue across the network;
• Customers will continue to earn Woolworths’ Rewards points on fuel and merchandise purchases across the network; and
• Woolworths Group will commence a new wholesale food supply agreement to the network, providing an extensive product range and competitive pricing.
EG Group is a global leader in fuel and convenience retailing, operating circa 4,700 sites across Europe and North America, employing over 28,500 colleagues across leading retail brands such as ESSO, BP, Shell, Carrefour, Louis Delhaize, SPAR, Starbucks, Burger King, KFC, Greggs, Pomme de Pain, Subway, Turkey Hill, Loaf ‘N Jug and Kwik Shop.
In September 2018, EG Group announced further expansion across the US through the acquisition of a portfolio comprising 225 Minit Mart branded convenience retail stores and petrol stations, which will be transferred and integrated into the existing network in December. With the inclusion of the Woolworths assets, EG Group will own and operate circa 5,250 sites across Europe, the US and Australia.
Mohsin Issa, EG Group Founder and co-CEO expressed: “For the past 17 years, we have had a vision of becoming a leading petrol station/convenience store operator around the world. This is another exciting international milestone on our growth journey.
We are the leading independent petrol forecourt retailer in Europe and are having great success in the US. The Woolworths’ assets present a fantastic opportunity to further grow our international footprint and deliver our best-in-class retail experience in a new geography. We are committed to investing in the site network, introducing leading retail brands, developing the alliance with Woolworths and working with the exceptional management team.”
Brad Banducci, Woolworths Group CEO said, “This transaction is a positive for our customers, our team and our shareholders.
“The agreement will continue to strengthen the opportunities our customers have for greater value when shopping with us, with the benefits of the Woolworths’ Rewards program and the fuel discount offer set to continue.
“A long-term wholesale food supply arrangement will also ensure that EG Group can benefit from competitive product sourcing, including Woolworths’ own brands, to provide a world class convenience offer that will add further scale to Woolworths.”
The transaction is subject to Australian Foreign Investment Board (FIRB) approval.
Completion is expected to occur in early 2019.
Citigroup is acting as lead financial advisor and Barclays as joint financial advisor to EG Group. As part of the transaction, EG Group also received fully committed financing from a bank group led by Barclays.
Allen & Overy LLP are M&A and Corporate legal advisors, and Kirkland & Ellis LLP are Banking and Finance legal advisors.
About EG Group
Founded in 2001 by brothers Zuber and Mohsin Issa, United Kingdom based EG Group is a leading petrol forecourt retail convenience operator who has established partnerships with global brands such as ESSO, BP, Shell, Carrefour, Louise Delhaize, SPAR, Starbucks, Burger King, KFC, Greggs and Subway. The business has an established pedigree of delivering a world class fuel, convenience and food-to-go offer.
The EG Group currently employs over 28,500 staff working in circa 4,700 sites across Europe and the US.
EG Group has made a significant commitment to delivering a modern consumer retail offer which exceeds expectations and creates a true ‘one-stop’ retail destination to satisfy multiple consumer missions. The business is regularly recognized for innovation and investment in convenience retail assets, the employees and the systems. Zuber Issa and Mohsin Issa, Founders and co-CEOs of Euro Garages, were jointly named the 2018 EY Entrepreneur of the Year in the UK.
Further information at www.eurogarages.com.
Media: Martin Currie, Citypress
T: +44 (0)161 235 0310
Investors: Michael Hughes, EG Group
M: +44 (0)1254 582111
Founded in 1924, Woolworths Group is Australia’s largest retailer with more than 3,500 stores Australia and New Zealand employing more than 200,000 people. Woolworths manages some of Australia and New Zealand’s most recognised and trusted brands including Woolworths, Countdown, Dan Murphy’s, BWS, Langtons, Cellarmasters, BIG W and ALH. www.woolworthsgroup.com.au
Investors and Analysts
Paul van Meurs
Head of Investor Relations
+61 407 521 651
Woolworths Press Office
+ 61 2 8885 1033