CST Brands, Inc., a San Antonio-based Fortune 500 fuel and convenience retailer, announced today the closing of the previously announced sale of all 79 stores in the California and Wyoming markets to 7-Eleven, Inc. and its wholly-owned subsidiary, SEI Fuel Services, Inc.
The closing purchase price for the transaction is $408 million plus adjustments for inventory and working capital. With the closing of this transaction, CST expects to realize a tax benefit from the completion of a like kind exchange strategy with its acquisition of the Flash Foods properties in Georgia and Florida that closed earlier this year. The Company anticipates using the majority of the cash proceeds from the sale to pay down borrowings under CST’s revolving credit facility.
Raymond James advised CST Brands, Inc. in the transaction.
Additionally, CST Brands and CrossAmerica Partners LP announced that it has reached an agreement regarding the refund associated with CST’s sale of its California and Wyoming stores.
With today’s announced closing of the sale of 79 California and Wyoming sites by subsidiaries of CST Brands, Inc. to 7-Eleven, CST has agreed to compensate CrossAmerica for the decrease in revenues related to its 17.5% interest in CST’s wholesale fuel business, CST Fuel Supply LP. CST and the Partnership have agreed to a refund of a portion of the 2015 purchase price paid by the Partnership for its ownership interest in CST Fuel Supply, as it relates to the approximately 191 million gallons sold annually to the 79 California and Wyoming sites that were sold to 7-Eleven. The total refunded consideration is approximately $18.2 million.
The independent executive committee of the board of directors of CST Brands and the independent conflicts committee of the board of directors of the general partner of CrossAmerica have reviewed and approved the terms and amount of the refund.