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Brookfield Business Partners buys Loblaw’s gas bar ops
Posted on Wednesday, 19 April 2017 13:46
Brookfield Asset Management’s flagship listed business services and industrials arm is acquiring one of Canada’s largest petrol station networks for CAD 540.00 million (USD 404.50 million) in the third quarter of 2017.

The deal for Loblaw’s 213 retail locations and associated convenience kiosks found next to the company’s owned grocery stores closes the door on a process which kicked off in the second quarter of 2016.

According to the 2016 annual report, the gas bar operations, which is merely one operating business housed within Loblaw’s retail segment, sold about 1,700 million litres of petrol and generated sales of roughly USD 1.60 billion.

This umbrella division mainly comprises corporate and franchise-owned food and associate-owned drug stores, in-store pharmacies and apparel and other general merchandise, among others.

Separately, Brookfield Business Partners has entered into a deal with Imperial Oil to rebrand the petrol station portfolio to ExxonMobil’s Mobil fuel banner, which will mark the introduction of this label in Canada.

However, the network will continue to offer Loblaw’s loyalty programme and in so doing will retain customers who are rewarded for shopping at the group’s grocery stores and using the retail locations.

Brookfield Business Partners was formed in January 2016 and officially split off from Brookfield Asset in June to focus on owning and operating business services across the construction, residential real estate and facilities management sectors.

Its other arm concentrates on industrials assets, comprising oil and gas exploration and production, palladium and aggregates mining and the manufacture of graphite electrodes, engineered precast systems and pipe products.

Brookfield Business Partners’ acquisition is among the largest by value of a Canadian business announced so far this year, according to Zephyr, the M&A database published by Bureau van Dijk.

The deal comes on the heels of Chevron announcing the sale of Chevron Canada R&M ULC, which operates its integrated downstream fuel activities in the country, to Parkland Fuel for CAD 1.46 billion.

It noted the divestment comprises 129 branded retail stations mainly located in metro Vancouver and 37 cardlock and three marine fuelling sites, among other things.

© Zephus Ltd