Strengthening Couche-Tard's Position in Attractive Southeastern
and Gulf Coast United States
LAVAL, QC and CARY, NC, Dec. 18,
2014 /PRNewswire/ - Alimentation Couche-Tard Inc. (TSX:
ATD.A ATD.B), ("Couche-Tard"), and The Pantry, Inc. (NASDAQ: PTRY),
today announced a definitive merger agreement under which
Couche-Tard will acquire The Pantry in an all-cash transaction
valued at US $36.75 per share, with a
total enterprise value of approximately US $1.7 billion including debt assumed. The terms of
the agreement were unanimously approved by the Boards of Directors
of both companies.
The transaction price represents a premium of 27% to The
Pantry's closing share price on December 16,
2014, the last trading day prior to public media reports
that The Pantry, Inc. was exploring a potential transaction, and a
premium of 39% to the 30-day average share price ending on
December 16, 2014.
"We look forward to welcoming The Pantry, Inc. to the
Couche-Tard family" said Brian P.
Hannasch, Couche-Tard's President and Chief Executive
Officer. "The Pantry is an excellent company and is well positioned
in the Southeastern and Gulf Coast regions of the U.S., two of the
fastest growing areas of the U.S. With this transaction we will add
more than 1,500 stores to our network which will position us as the
definitive leader in this region and will reinforce our position as
one of the largest convenience store operators in North America. We look forward to combining
the capabilities of The Pantry team with Couche-Tard to enhance
value for our shareholders. We strongly believe that our all-cash
offer is compelling for The Pantry's shareholders as it offers them
the opportunity to realize full and immediate value for their
investment."
Dennis G. Hatchell, President and
CEO of The Pantry, Inc. said "I am very proud of The Pantry
employees and what they have accomplished. The company's current
performance is a direct result of the employees' hard work and
effort. Their work has clearly been recognized by the
marketplace and by Couche-Tard, culminating in this
transaction. This is an exciting combination of two strong
companies that complement each other extremely well. Unlocking the
strategic value of these combined firms will benefit the current
Pantry shareholders and provide ongoing opportunities for most of
our employees. I sincerely thank and appreciate each of the
employees for their contributions to the success of this
organization."
Additional Information
The transaction is expected to close in the first half of 2015,
subject to the approval of The Pantry shareholders and customary
regulatory approvals. The transaction includes customary breakup
fees. This all-cash transaction is expected to be financed by
Couche-Tard's available cash, existing credit facilities and a new
term loan.
Faegre Baker Daniels LLP is acting as exclusive legal advisor to
Alimentation Couche-Tard Inc. BofA Merrill Lynch is acting as
exclusive financial advisor to The Pantry, Inc. Willkie Farr
& Gallagher LLP and Smith Anderson are acting as legal advisors
to The Pantry, Inc.
In connection with the proposed transaction, The Pantry intends
to file a proxy statement and other relevant documents concerning
the proposed transaction with the SEC. The Pantry will provide the
full proxy statement to its stockholders. Investors and
stockholders are urged to read the proxy statement and any other
relevant documents filed with the SEC when they become available,
as well as any amendments or supplements to those documents,
because they will contain important information about the
transaction. Investors and stockholders will be able to obtain a
copy of the proxy statement as well as other filings containing
information about The Pantry free of charge at the SEC's Web Site
at http://www.sec.gov. In addition, the proxy statement, the SEC
filings that will be incorporated by reference in the proxy
statement and the other documents filed with the SEC by The Pantry
may be obtained free of charge from The Pantry's Investor Relations
page on its corporate website at http://www.thepantry.com.
The Pantry and its directors, executive officers, and certain
other members of management and employees may be deemed to be
participants in the solicitation of proxies in favor of the
proposed transaction from the stockholders of The Pantry.
Information about the directors and executive officers of The
Pantry is set forth in The Pantry's Annual Report on Form 10-K for
the year ended September 26, 2013, as
amended on January 24, 2014, and the
proxy statement on Schedule 14A for The Pantry's 2014 Annual
Meeting of Stockholders, which was filed with the SEC on
February 13, 2014. Additional
information regarding participants in the proxy solicitation may be
obtained by reading the proxy statement regarding the proposed
transaction when it becomes available.
About Alimentation Couche-Tard
Couche-Tard is the leader in the Canadian convenience store
industry. In the United States, it
is the largest independent convenience store operator in terms of
number of company-operated stores. In Europe, Couche-Tard is a leader in convenience
store and road transportation fuel in Scandinavian and Baltic countries while it has a significant
presence in Poland.
As of October 12, 2014,
Couche-Tard's network comprised 6,303 convenience stores throughout
North America, including 4,851
stores with road transportation fuel dispensing. Its North-American
network consists of 13 business units, including nine in
the United States covering 40
states and four in Canada covering
all ten provinces. More than 60,000 people are employed throughout
its network and at the service offices in North America.
In Europe, Couche-Tard operates
a broad retail network across Scandinavia (Norway, Sweden, Denmark), Poland, the Baltics (Estonia, Latvia, Lithuania) and Russia, which comprised 2,239 stores as
of October 12, 2014, the majority of
which offer road transportation fuel and convenience products while
the others are unmanned automated service-stations which offer road
transportation fuel only. The Corporation also offers other
products, including stationary energy, marine fuel, aviation fuel,
lubricants and chemicals. Couche-Tard operates key fuel terminals
and fuel depots in eight countries. Including employees at Statoil
branded franchise stations, about 17,500 people work in its retail
network, terminals and service office across Europe.
In addition, under licensing agreements, about 4,600 stores are
operated under the Circle K banner in 12 other countries worldwide
(China, Guam, Honduras, Hong
King, Indonesia,
Japan, Macau, Malaysia, Mexico, the
Philippines, Vietnam and
the United Arab Emirates) which
brings to more than 13,100 the number of sites in Couche-Tard's
network.
About The Pantry, Inc.
Headquartered in Cary, North
Carolina, The Pantry, Inc. is a leading independently
operated convenience store chain in the southeastern United States and one of the largest
independently operated convenience store chains in the country. As
of December 18, 2014, the Company operated 1,512 stores in
thirteen states under select banners, including Kangaroo
Express®, its primary operating banner. The Pantry's
stores offer a broad selection of merchandise, as well as fuel and
other ancillary services designed to appeal to the convenience
needs of its customers.
Safe Harbor Statement
Statements made in this press release relating to future plans,
events, or financial condition or performance are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements can generally
be identified by the use of words such as "expect," "plan,"
"anticipate," "intend," "outlook," "guidance," "believes,"
"should," "target," "goal," "forecast," "will," "may" or words of
similar meaning. Forward-looking statements are likely to address
matters such as the companies' respective or combined anticipated
sales, expenses, margins, tax rates, capital expenditures, profits,
cash flows, liquidity and debt levels, as well as their pricing and
merchandising strategies and their anticipated impact and
intentions with respect to acquisitions, the construction of new
stores, including additional quick service restaurants, and the
remodeling and addition of new equipment and products to existing
stores. These forward-looking statements are based on the
companies' current plans and expectations and involve a number of
risks and uncertainties that could cause actual results and events
to vary materially from the results and events anticipated or
implied by such forward-looking statements.
The following factors, among others, could cause actual results
and events to differ materially from those expressed or implied in
the forward-looking statements: (1) the occurrence of any event,
change or other circumstances that could give rise to the
termination of the merger agreement; (2) the inability to complete
the transactions contemplated by the merger agreement due to the
failure to obtain the required stockholder approval; (3) the
inability to satisfy the other conditions specified in the merger
agreement, including, without limitation, the receipt of necessary
governmental or regulatory approvals required to complete the
transactions contemplated by the merger agreement; (4) the risk
that the proposed transactions disrupt current plans and
operations, increase operating costs and the potential difficulties
in customer loss and employee retention as a result of the
announcement and consummation of such transactions; (5) the outcome
of any legal proceedings that may be instituted against the
companies following announcement of the merger agreement and
transactions contemplated therein; and (6) the possibility that the
companies may be adversely affected by other economic, business,
and/or competitive factors.
Any number of other factors could affect actual results and
events, including, without limitation; the ability to enhance
operating performance through in-store initiatives, store remodel
programs and the addition of new equipment and products to existing
stores; fluctuations in domestic and global petroleum and fuel
markets; realizing expected benefits from fuel supply agreements;
changes in the competitive landscape of the convenience store
industry, including fuel stations and other non-traditional
retailers located in the companies' markets; the effect of national
and regional economic conditions on the convenience store industry
and the companies' markets; the global financial crisis and
uncertainty in global economic conditions; wholesale cost increases
of, and tax increases on, tobacco products; the effect of regional
weather conditions and climate change on customer traffic and
spending; legal, technological, political and scientific
developments regarding climate change; financial difficulties of
suppliers, including the companies' principal suppliers of fuel and
merchandise, and their ability to continue to supply their stores;
the companies' financial leverage and debt covenants; a disruption
of IT systems or a failure to protect sensitive customer, employee
or vendor data; the ability to identify suitable acquisition
targets and to take advantage of expected synergies in connection
with acquisitions; the actual operating results of new or acquired
stores; the ability to divest non-core assets; environmental risks
associated with selling petroleum products; governmental laws and
regulations, including those relating to the environment and the
impact of mandated health care laws; and unanticipated legal and
other expenses. These and other risk factors are discussed in
Alimentation Couche-Tard Inc. and The Pantry, Inc.'s filings with
securities authorities in Canada
and the United States,
respectively. While the companies may elect to update these
forward-looking statements at some point in the future, they
specifically disclaim any obligation to do so.
SOURCE Alimentation Couche-Tard Inc.