Couche-Tard withdraws bid for Australia’s Caltex

Date : 21 April 2020

Stewart Samuel

Program Director - Canada

Couche-Tard has withdrawn its bid for Caltex, an Australian-based convenience and fuel business, citing the uncertainty in the global outlook due to the coronavirus pandemic.

Caltex acquisition

Couche-Tard made an initial bid for Caltex last November as part of its focus on developing its Asia-Pacific presence. In mid-February, it made a revised bid for the company and although a competing bid emerged, the retailer was actively engaged in due diligence work with Caltex. UK-based Euro Garages made its own bid for the business, although this was rejected by Caltex in early March.

Uncertain business outlook

The due diligence work indicated that Caltex was a good strategic fit for Couche-Tard and the retailer remains interested in formalising a transaction. However, the disruption created by the Covid-19 pandemic, including within the Australian fuel and convenience sectors, has created a more uncertain outlook. Couche-Tard is also prioritising running its core business during this period. Consequently, it is not moving ahead with a revised proposal at this stage. The plan is to re-engage in the process when there is further clarity in the global outlook.

Oil price fall adds to uncertainty

In addition to a significant convenience store business, Caltex operates a major fuel business, including refining and supplying aviation fuel. The collapse in the oil price has added to the uncertainty to the outlook for the business, with its share price falling significantly since Couche-Tard’s latest bid.

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