Four-Store Purchase Tip of the Iceberg for CST Brands Growth

Chain outlines plans in Canada and the U.S.

Published in CSP Daily News

CST Brands buys four Sobeys stores, rebrands five others to Shell

SAN ANTONIO -- The addition of four stores in the Quebec market signals CST Brands Inc.’s plans to expand in Eastern Canada even as the chain plans to open nine new stores in early 2014, according to company officials.

CST, owner of the Dépanneur du Coin and Corner Store banners, acquired the four sites from Sobeys, owner and/or distributor of 205 Shell stations in Quebec, as reported in a Raymond James/CSP Daily News Flash.

The stores will be rebranded to Dépanneur du Coin, but will remain selling Shell fuel, while five Dépanneur du Coin stores will change their fuel brand to Sobeys’ Shell. The implementation of the alliance is planned for early 2014.

"This agreement is in keeping with our plans to expand the presence of Dépanneur du Coin in Eastern Canada as a convenience goods retailer. This is a first for CST Brands, expanding our fuel offerings by broadening our brand offerings with Shell," said Christian Houle, senior vice president, Canadian Retail, CST Brands Inc.

Meanwhile, Corner Store team members will be busy this holiday season building nine new stores, most of them slated to open in the first quarter of 2014. The new builds on tap follow a slate of 11 new store openings in the past four months, auspicious beginnings for the new company, which spun off from Valero on May 1. After spinning off, CST became the second-largest publicly traded retailer of convenience merchandise and motor fuels in North America.

To celebrate, executives from CST Brands, Corner Store’s San Antonio-based parent company, will be traveling to New York to ring the bell on Wall Street on Tuesday, Dec. 3. CST Brands CEO Kim Bowers will open trading on the floor of the New York Stock Exchange flanked by members of the company’s board of directors and leadership team and CST team members from Halifax to California.

“We think our beautiful store designs and great food offerings can compete with anyone out there, and we look forward to building more new stores in 2014 than ever before,” Bowers said.

In the past four months, CST Brands has opened nine new Corner Stores in Texas: Austin, Montgomery County, Willis, Houston, Conroe, Burnet, League City, Katy and the newest one last Friday in San Antonio. CST also opened a new store in Albuquerque, N.M., and razed and rebuilt one store in Commerce City, Colo.

Corner Stores are under construction across Texas, including in Dallas, Dripping Springs, Pleasanton, Fort Worth, Cuero, Pearland, Conroe and Cypress. Another new Corner Store is underway in Bernalillo, N.M. Seven of the new stores are expected to open in the first quarter of 2014.

Back in Canada, Sobeys Québec aims primarily to strengthen ties with its customers through its deal with CST. "The addition of five new Shell stations in close proximity to five of our IGA stores gives our AIR MILES program even more added value," said Pierre St-Laurent, senior vice president of business development at Sobeys Québec. "This partnership demonstrates first and foremost a desire to offer our customers more by providing local services and offers."

Food products and fuel are supplied to the nine stations by Sobeys Québec and the Sobeys Québec Petroleum Branch.

CST Brands Inc. is one of the largest retailers of convenience merchandise and motor fuels in North America. Based in San Antonio, Texas, CST employs approximately 12,000 team members at nearly 1,900 locations throughout the Southwestern United States and Eastern Canada.

Sobeys Québec is a subsidiary of Sobeys Inc., wholly owned by Empire Company Limited. Headquartered in Montréal-Nord, Sobeys Québec operates several banners, including IGA, Les Marchés Tradition, Marché Bonichoix, Rachelle-Béry health food stores, and various convenience stores, including Voisin, Bonisoir, and Select. Sobeys Québec also owns 205 Shell service stations throughout the province.

Keywords: 
financial, M&A