Canadian convenience store operator Alimentation Couche-Tard Inc. is making a powerful foray into northern Europe and its first into overseas markets. Currently, the owner of Mac's convenience stores operates in Canada and the United States, and now it is expanding into Norway.
The Canadian company is paying $2.8 billion for retail assets of Norwegian oil giant Statoil ASA. The plan is ambitious for the Canadian retailer and it represents a key and important peg in a new European growth strategy.
Couche-Tard shareholders were pleased and bidding on the shares shot up 15 percent on the news today. Some analysts are estimating that the deal could increase annual earnings by 20 percent. The deal will include 2,300 gas and retail stations in six Scandinavian and Baltic countries, including: Norway, Sweden, Denmark, Latvia, Estonia, and Poland.
To ensure some continuity, the existing European management team will be left in place. To improve performance, they plan on streamlining operations and increasing profit margins with different mixes of new product and enhanced store designs.