Forecourt retailer Applegreen has announced the acquisition of a 40% stake in the business that operates Connecticut Service Plazas, a US-based motorway service operation.
The group said that it has entered into a consortium alongside IST3 Investment Foundation and TD Greystone Asset Management to purchase JLIF Holdings (Project Service) US, and its subsidiary Project Services LLC, which together operate the Connecticut-based business.
The acquisition includes 23 service plazas along the I-95, I-395 and Route 15 highways in the state of Connecticut, which Applegreen has described as a 'well-established and fully re-developed service plaza business'.
Applegreen said that the investment supports its strategic objective for growth in North America, as well as its ambition to reduce fuel dependancy through the development of food and beverage operations.
The group has also entered into a call option with and TD Greystone, exercisable at five years after the completion of the transaction, which would enable Applegreen to increase its interest in the business to 60%, taking majority control.
"This transaction represents a rare opportunity to acquire a high profile service plaza concession project in one of our core regions in the United States, significantly increasing our market presence in the North East and positioning the company for further growth in this key strategic market," commented Bob Etchingham, chief executive, Applegreen.
The 23 plazas operate 24 hours a day, 7 days a week, with 91% of the revenue therein generated by long-term anchor tenants including McDonalds, Dunkin' Donuts, Subway and Alliance Energy.
The acquisition will be funded 'from existing group debt facilities' and the company 'still expects to remain broadly on track with its deleveraging objective for the next two years', Applegreen said.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.