ExxonMobil’s announcement that it’s exiting the U.S. retail business could inspire Alimentation Couche-Tard to acquire the stores, reported the National Post in Canada, where Couche-Tard is headquartered.
The National Post reported that Couche-Tard’s management is seeking larger acquisition targets in fiscal 2009, analyst Sara O’Brien of RBC Capital Markets said in a note to clients, reiterating her outperform rating and price target of $19 on the Quebec-based convenience chain’s shares.
"We see Couche-Tard as holding a bargaining chip" in offering to convert some of its Circle K branded stations, O’Brien wrote. "In addition, Couche-Tard’s reputation as solid operators delivering gas volume growth … will likely be considered in the bids."
O’Brien expects renewed investor interest in the retailer from potential deals, adding that the company’s shares have been driven down because of lower gas margins and softer volume, and could be a good defensive buy.
Last week, ExxonMobil said it’s selling its remaining 820 company-owned gas stations, as well as another 1,400 outlets operated by dealers. Fully 75% of Exxon’s 12,000 gas stations in the U.S. are already owned by branded distributors who buy ExxonMobil’s products and pay to use the company’s name, the Associated Press reported.