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Refuel has grown via acquisitions since First Reserve

bought in

2019

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Company owns around 230 stores, mainly in Carolinas

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Convenience-store industry consolidating amid slowing

growth and

inflation

By Abigail Summerville and David French

Nov 8 (Reuters) - The private-equity owner of Refuel is

exploring strategic options including a potential sale that

could value the U.S. convenience-store operator at more than

$1.5 billion including debt, people familiar with the matter

said on Friday.

The move comes as a wave of consolidation rolls through the

convenience-store industry.

Some store operators are looking to expand geographically,

even as the sector copes with slowing growth. Inflation has

forced shoppers to cut back spending on groceries and staples.

Private-equity firm First Reserve, which acquired Refuel in

2019, is in talks with investment bankers to launch a sale

process for the convenience-store operator in the first half of

2025, the sources said, requesting anonymity as the discussions

are confidential. Potential buyers include other store operators

and buyout firms, the sources said.

Based on comparable transactions in the sector, Refuel could

command a valuation equivalent to about 13 times its core annual

earnings of roughly $120 million, the sources said, cautioning a

deal is not guaranteed and First Reserve may keep the business.

First Reserve and Refuel declined to comment.

Charleston, South Carolina-based Refuel owns around 230

convenience stores and gas stations, mainly in North Carolina

and South Carolina as well as other states, including

Mississippi, Arkansas and Texas, according to its website.

Under the ownership of First Reserve, which mainly focuses

on investing in the energy sector, Refuel has grown through

acquisitions of other store operators and family-owned

convenience stores.

In January 2022, First Reserve said it had moved its Refuel

investment into a continuation fund, which allows buyout firms

to continue owning an asset beyond its traditional lifespan.

This structure also allowed Refuel to attract funding from new

investors.

Refuel's deliberations on a potential sale mirror moves from

other store operators.

Reuters reported in September that Arko ( ARKO ) was seeking

to shed its convenience-store operations in a deal that could be

valued at around $2 billion. This year, Sunoco ( SUN ) agreed to

sell 204 stores to 7-Eleven in a deal worth $1 billion.

In July, Casey's General Stores struck a

$1.15-billion deal to buy Fikes Wholesale, the owner of CEFCO

convenience stores, to expand in Texas.