ARKO Corp., one of the largest convenience store operators and fuel wholesalers in the country, recently closed on its acquisition of Quarles Petroleum’s fleet fueling and dealer supply businesses through its GPM Investments subsidiary.
The acquisition includes 121 Quarles-branded cardlock sites, management of 63 third-party cardlock sites for fleet fueling operations, and 46 independent dealer locations, including certain lessee-dealer sites, and a small transportation fleet.
“We plan to continue to pursue acquisitions like the Quarles Acquisition as we focus on strategic growth that generates long-term shareholder value,” said Arie Kotler, president and CEO of ARKO. “The acquired Quarles assets comprise a complementary business that has operated continuously for more than 80 years, and we believe we can grow and expand the company’s fleet fueling platform and continue to provide best-in-class fuel services and solutions to our customers.
“In addition, nearly 100 Quarles employees will be retained and become employees of GPM. They are accomplished operators, and we welcome them into our family of community brands.”
The Quarles acquisition is ARKO’s 21st add-on since 2013.
Using estimated forward-looking, non-GAAP measures, the company expects the addition of Quarles to generate approximately $17.5 million of adjusted EBITDA on an annualized basis, after incremental rent of approximately $7.8 million to be paid to Oak Street Real Estate Capital, a Division of Blue Owl Capital, the private equity real estate firm that funded approximately $130 million of the aggregate purchase price.
The Quarles Acquisition is expected to add approximately 160 million gallons, primarily diesel, to the approximately 2 billion gallons ARKO currently sells annually, as well as fleet fueling card operations that are expected to facilitate the sale of approximately 50 million gallons at third-party locations nationwide.
Quarles sold its propane, heating oil, and commercial fuels distribution business to Superior Plus in June. At the time, Quarles was one of the largest propane and refined fuels distribution companies in the U.S., serving more than 80,000 residential and commercial customers in Virginia, West Virginia, Washington, D.C., Maryland, Pennsylvania and North Carolina through a network of more than 30 bulk plants and one of the country’s largest fleet fueling networks.
The closing of the GPM transaction marks Quarles’ final exit from the petroleum marketing industry.
