Core-Mark Holding Co. Inc., one of the largest marketers of fresh and broad-line supply solutions to the convenience retail industry in North America, has signed a Definitive Stock Purchase Agreement to acquire J.T. Davenport & Sons Inc., located in Sanford, N.C.
The transaction is structured as an all-cash stock acquisition, pursuant to which Davenport will become a wholly-owned, indirect subsidiary of Core-Mark.
The owners, management and employees of Davenport have built their company into a leading independent wholesale distributor in the Southeast. Their commitment to bringing value to their customers has resonated with the 2,000 convenience stores they serve from their modern facility in Sanford, N.C. Davenport has an established track record of sales and profit and is an industry leader in their sales technology.
The purchase price is estimated to be approximately $45 million, predicated on the value of certain assets and liabilities to be determined at closing. No debt is being assumed in this transaction. Core-Mark will fund this purchase with a combination of cash on hand and borrowings under its $200 million revolving credit facility. The deal is expected to close by the end of 2012 and is expected to be accretive in 2013, excluding approximately $2.5 million in start-up and conversion costs, a portion of which will be incurred in 2012.
“We are extremely pleased to welcome Mark Davenport and his company to the Core-Mark family. For decades, J.T. Davenport has built a well-deserved reputation as a top tier distributor in the industry. I look forward to Mark’s leadership in creating customer solutions by combining J.T. Davenport’s best practices and market presence with Core-Mark’s marketing strategies and technology,” said J. Michael Walsh, president and CEO of Core-Mark. “Our shared cultures, values, and focus on customer needs make this business combination a great fit.”
“In 2012 our company will have reached its 95th successful year of operation by placing value in building strong partnerships with our customers, the dedication of our employees and the support of our supplier community. As the industry has grown and changed over time, Davenport changed with those demands but always stayed consistent with our values. In Core-Mark we see the same vision and dedication necessary to continue servicing our customers’ needs. Core-Mark’s decentralized platform will allow Davenport’s customers and employees greater opportunity to meet the unique challenges we face at the local level while enjoying the leverage and support of being a national supplier. The Davenport management team and I are looking forward to the opportunity this provides us in bringing new and exciting programs to our customers, helping them grow their sales and profits” said Mark Davenport, president of Davenport.