ARKO Corp. Acquires WTG Fuels Assets

The $140.4 million deal includes 24 Uncle’s Convenience Stores and GASCARD-branded cardlock sites.

December 08, 2022

RICHMOND, Va.—ARKO Corp. has acquired the retail, wholesale and fleet fueling assets of WTG Fuels Holdings, the owner of Uncle’s Convenience Stores and GASCARD fleet fueling operations, for $140.4 million plus the value of inventory at closing.

WTG has 24 company-operated Uncle’s Convenience Stores across western Texas. The deal also includes three land parcels and nine independent dealer locations. ARKO will also acquire WTG’s 57 proprietary GASCARD-branded fleet fueling cardlock sites and 52 private cardlock sites, one of the largest fleet fueling operations in West Texas.

“We are committed to creating value for our stockholders with a systematic, convenience-store focused long-term growth strategy focused on disciplined and accretive transactions,” said Arie Kotler, ARKO’s chairman, president and CEO. “We believe that we add significant value to acquisitions with our excellent integration capacity, which has helped accelerate the pace of dealmaking, which in turn improves our business, creates more efficiencies, and funds future growth—a virtuous cycle that we believe sets ARKO apart as a leading convenience store operator and acquirer of choice. Adding these assets to our Family of Community Brands is perfectly aligned with ARKO’s strategy, and we look forward to welcoming WTG employees to our company.”

Uncle’s stores offer grocery, beer and fresh food options. They are known for their high-quality foodservice, including Uncle’s branded fresh food, Hunt Brothers Pizza and Champs Chicken. Certain stores also have walk-in beer caves. Uncle’s Convenience Stores have had very strong diesel sales, which currently comprise over 1/3 of their overall fuel volume.

GASCARD’s 57 proprietary fleet fueling cardlock sites are strategically located in large industrial areas in West Texas and southeast New Mexico and service a diverse base of customers. The company also operates 52 private cardlock sites. Nearly 3/4 of fuel sales by volume at the cardlock locations have been diesel. In addition, the business issues fuel cards that provide customers access to a nationwide network of fueling sites.

ARKO’s agreement to acquire WTG’s convenience store, fleet fueling business and independent dealer locations is the company’s fourth announced acquisition of 2022.

“Together with the recently announced Pride Convenience Holdings and Transit Energy Group transactions, the acquisition of WTG’s assets highlights the company’s systematic growth strategy designed to increase the company’s cash flow and adjusted EBITDA,” wrote ARKO in a statement.

Combined, WTG, Pride and TEG are expected to grow the ARKO’s base of convenience stores by approximately 15%, adding over 200 retail stores and a pipeline of new build opportunities.

In July, GPM closed its acquisition of 121 branded and 63 contracted cardlock sites and 46 independent dealer locations from Quarles Petroleum. It was GPM’s 21st acquisition in 10 years.

WTG would greatly expand ARKO’s highly accretive fleet fueling segment, growing from 183 sites at the end of the third quarter of 2022 to over 290 upon closing. WTG sold about 85 million total gallons in FY 2021 across its stores, fleet fueling and independent dealer locations.

“We believe that Uncle’s stores are great sites, and, importantly, we are strategically using our in-house fleet fueling expertise to grow that segment. We are highly focused on our core convenience store business and have been very pleased with the performance of the fleet fueling segment and the cash flow it generates,” said Kotler.

For more about ARKO and GPM's vision for the future, read “Tying it All Together” from the March 2021 issue of NACS Magazine.