Viva Energy to Purchase OTR Group for Approximately $770 Million

The acquisition supports Viva Energy’s vision to be Australia’s leading convenience retailer.

April 06, 2023

ALEXANDRIA, Va.—Viva Energy Group Limited has entered into a binding agreement to acquire On the Run (OTR) Group for a total consideration of about $770 million ($1.15 billion Australian) from Peregrine Corporation.

The acquisition of the OTR business further delivers on Viva Energy’s strategy to grow high-quality, non-fuel earnings streams, and provides a significant opportunity to unlock procurement and supply chain synergies, the company said in a statement.

Approximately 6,500 OTR team members and support center staff will join the Viva Energy Group on their current terms and conditions. Viva Energy will retain the OTR head office in Adelaide which, along with the existing Melbourne-based team, will service the Group’s convenience and mobility business over time.

OTR founder Yasser Shahin will be retained by Viva Energy to support the existing OTR Group and transition the business to Jevan Bouzo, Viva Energy’s CEO of convenience and mobility. Their combined priorities will be to integrate the businesses, build the operating structure, further develop the OTR network, test formats for deployment into the Coles Express network and realize synergies. Viva Energy purchased Coles Express in September.  

According to the statement, the acquisition of the OTR Group secures leading convenience and quick service restaurant capability to rapidly deploy new formats across the network and further transform the convenience and mobility business in the following areas:

  • Bring together the OTR, Coles Express and Viva Energy Retail businesses to establish a nationwide convenience network with a pathway to more than 1,000 stores and capability for a market-leading convenience and mobility offering in Australia.
  • Immediately increase the earnings contribution from convenience from ~30% to ~50% of the convenience and mobility business, reducing dependency on income from traditional fuels and increasing exposure to the fast-growing convenience sector.
  • Extend the proven OTR convenience offer and technology platforms to Coles Express stores that can support the format, taking the OTR brand nationally and growing convenience sales. OTR’s convenience sales per store are, on average, more than double what is achieved through the Coles Express network, presenting considerable growth upside.
  • Achieve significant scale and synergies in procurement, marketing and functional support. OTR substantially reduces the time and cost of setting up infrastructure to replace the transitional services arrangements provided by Coles Group, by transitioning directly to proven and existing back-office infrastructure.
  • Combine the best of the Coles Express and OTR digital and loyalty offers into one compelling customer proposition. The OTR digital platforms provide customers with fuel, QSR and convenience rewards and discounts, which supports higher sales through cross-selling convenience and fuel products.

Shahin said, “Today’s announcement marks an incredibly exciting time for our company. This transaction delivers the realization of the vision I have always had, and vigorously pursued: to see OTR become national, to be the leading convenience brand in Australia and to remain true to our roots and based in Adelaide.”