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Mom-And-Pop Convenience Stores By



© Reuters

By Christiana Sciaudone — The special acquisition vehicle has become a convenient way to go public this year. So much so, that even convenience stores are getting in on the SPAC game. 

Last month, Israel-based ARKO holdings agreed to combine with Haymaker Acquisition Corp II (NASDAQ:), a year-old SPAC helmed by former Starwood Hotels chief and Coca-Cola (NYSE:) executive Steven Heyer, with the goal of taking ARKO public in the U.S. after the deal closes later this year. 

But wait, what does this have to do with convenience stores? ARKO Chief Executive Officer Arie Kolter started in the business almost a decade ago and in that time has expanded his convenience store empire via 18 acquisitions. The most recent was a deal for GPM Investments, of which ARKO owns a 70% controlling interest, to buy Empire Petroleum. That tie-up closed this past week.

And there’s plenty more opportunity out there. 

Kolter points out that there are about 152,000 convenience store locations in the U.S., and just 20% are operated by the 10 biggest companies. That leaves some 120,000 mom-and-pop shops to be snapped up.

“It’s so fragmented, there’s an unlimited amount of opportunities,” Kolter said in a phone interview from Miami. “We’re not an idea. We have a track record. We’re an acquisition machine.”

The deal for Empire almost doubles its independently operated fueling stations to about 3,000, and adds 85 convenience stores for a total of more than 1,300 retail locations. GPM will now be present in 10 additional states, for a total of 33, and the District of Columbia.

Kolter said the focus is on rural and small town locations, where in some cases the convenience store is the local grocery store.

“We’re buying family businesses; we keep their employees, we’re keeping their brands,” Kolter said.

ARKO is also investing in upgrading stores. It’s current plans call for some 350 stores to get facelifts — including with Covid-friendly measures. Kolter says the improvements pay off as units already upgraded have seen up to a 60% return on investment.

Expansion will likely take place in states where they already have stores. 

“It’s all about economy of scale,” Kolter said. “We know how to achieve great economies of scale. We were able to double profit in some stores we bought.”

Casey’s General (NASDAQ:) Stores is the fourth-largest chain in the U.S. — ARKO’s family of stores is the seventh — and recent results show how profitable such businesses can be. Earnings per share for the three months ended July 31 came in at $3.24, compared to the expected $2.06. The result was 40% higher than a year earlier. 

Murphy USA (NYSE:) is the sixth-largest player in the U.S. The El Dorado, an Arkansas-based company reported profit of $5.73 per share, up from $1.01 a year earlier.  

“Murphy USA’s record second quarter performance once again demonstrated the competitive advantages of our distinctive business model and customer positioning,” said Chief Executive Officer Andrew Clyde in a statement in July. “Our outlook for the remainder of 2020 and 2021 remains very positive.” 

Some 4,000 convenience stores change hands every year, a number that started rising about six years ago. Seven & i, the Japanese company that owns 711 stores — and the biggest chain with 6% of the U.S. market — recently paid $21 billion for Speedway gas stations from Marathon Petroleum (NYSE:). Speedway is the third-biggest operator, with 2.6% of the market, Kolter’s not looking at such headline-generating purchases. 

“I’m just concentrating on smaller transactions in small markets,” Kolter said. “How can we increase profitability? That’s the bottom line.”


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Investors line up for Ant Group’s record $34.4 billion IPO By Reuters




© Reuters. FILE PHOTO: Ant Group logo is pictured at the Shanghai office of Alipay, owned by Ant Group which is an affiliate of Chinese e-commerce giant Alibaba, in Shanghai


By Julie Zhu and Scott Murdoch

HONG KONG (Reuters) – Ant Group Co Ltd (HK:) is poised to raise up to $34.4 billion in the world’s largest stock market debut as investors rush to buy into the fast-growing Chinese fintech giant despite risks of greater scrutiny at home and abroad.

The dual listing, a first for Shanghai’s Nasdaq-style STAR Market and Hong Kong, would value Ant at about $312 billion before a so-called greenshoe option for a 15% overallotment of shares.

At that valuation, Ant is worth more than Industrial and Commercial Bank of China (SS:), the world’s biggest bank by assets. The money raised will also shatter the record set by oil major Saudi Arabian Oil Co ( Saudi Aramco ) (SE:) with its $29.4 billion listing last December.

Jack Ma, the billionaire founder of Ant and affiliate Alibaba Group Holding (HK:) (N:), said it was a “miracle” that such a large listing is taking place outside New York.

Ant’s looming market debut had been clouded by concerns over growing regulatory scrutiny at home for its lucrative consumer credit business as well as a U.S. State Department proposal to add the company to a trade blacklist.

Global investors, however, have largely shrugged off those concerns as they bet on continued rapid growth of a group that also operates China’s biggest mobile payments platform and distributes wealth management and insurance products.

“The fear of missing out and the lack of other opportunities of this calibre” was spurring investor interest in the IPO, said Justin Tang, head of Asian research at investment adviser United First Partners in Singapore.


Ant’s order books on the Hong Kong offering to institutional investors was oversubscribed one hour after the launch, two people with direct knowledge of the matter said.

Many prospective investors placed orders worth at least $1 billion in the first hour, said one of the sources, adding that the number of the institutional orders could reach about 1,000.

Ant declined to comment on investor demand.

Headquartered in the Chinese city of Hangzhou, Ant is aiming to raise about $17.2 billion in Shanghai and roughly the same in Hong Kong.

The group has earmarked 80% of its domestic offering to 29 strategic investors that will be locked up for at least one year. A wholly-owned unit of Alibaba has agreed to purchase 44% of the Shanghai float.

Other strategic investors in the Shanghai float include China’s National Council for Social Security Fund, a unit of Singapore state investor Temasek Holding, as well as Singaporean and Abu Dhabi sovereign wealth funds GIC and Abu Dhabi Investment Authority.

Large Chinese insurers and mutual funds will also have shares allocated via the strategic investor route, Monday’s filing showed.


Ant shares are expected to start trading in Hong Kong and Shanghai on Nov. 5, two days after the U.S. election.

The company set the price tag for the Shanghai leg of the listing at 68.8 yuan ($10.27) per share and HK$80 ($10.32) per share for the Hong Kong tranche, the exchange filings showed.

The price represents a multiple of 31.4 times Ant’s 2021 earnings and 24.2 times its 2022 earnings forecast, said a source with direct knowledge of the matter.

By comparison, Alibaba is trading at 34.28 times trailing 12-month earnings in Hong Kong.

Ant declined to comment on the price multiples.

The group’s China listing would eclipse the record set there previously by Agricultural Bank of China (OTC:)’s (SS:) $10.1 billion float in 2010. The record in Hong Kong was set by insurance major AIA’s $20.5 billion offering in 2010.

The bookbuilding for the Hong Kong leg will run from Monday to Friday, while books for the Shanghai leg open for one day on Thursday.

Ant’s IPO would also serve to burnish STAR’s status.

Companies raised $22.5 billion via IPOs and secondary listings on STAR between the start of the year and mid-October, making it the third-biggest stock market behind Nasdaq and Hong Kong, Refinitiv data shows.

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Dow Slumps as Record Surge in Infection Triggers Bloodbath By




© Reuters.

By Yasin Ebrahim –The Dow fell sharply Monday, paced by a rout in value stocks on fears the recent spike in Covid-19 infections could weigh on the economic recovery amid fading hopes for U.S. stimulus before the election.

The fell 3.32%, or 942 points. The was down 2.86 %, while the fell 2.77%.

Coronavirus infections in the U.S. hit a record, adding more than 85,000 through Saturday, Bloomberg reported, after surpassing the previous record on Friday of 83,757 new cases.

Little sign of progress on stimulus talks, meanwhile, dimmed expectations the economy would receive a fiscal boost before the U.S. election on Nov. 3.

House Speaker Nancy Pelosi is reportedly waiting for another counteroffer from Treasury Secretary Steven Mnuchin, but as there remains sizable disagreement over key issues “reaching a deal ahead of the November election appears improbable, if not entirely impossible,” Stifel said in a note. Pelosi is reportedly set for further talks with Mnuchin at 2:00 PM ET (1800 GMT).

Energy and industrials led the move lower in value stocks, with the latter down on heavy selling in airline stocks as the spike in cases raised concerns that restrictions to curb infections could prompt airlines to cut capacity further. 

American Airlines (NASDAQ:) and Delta Air Lines (NYSE:) were down more than 7% while United Airlines Holdings Inc (NASDAQ:) slumped 8%.

Financials gave up some of their gains from last week as banking stocks were abandoned after Treasury yields reversed sharply, with down 5%.

JPMorgan Chase (NYSE:) and Bank of America (NYSE:) fell 3%, while Citigroup (NYSE:) slipped more than 2%.

Tech, which had led the rally since the mid-March bottom, added to the broader market selloff, with the Fab 5 nursing losses. (NASDAQ:) and Apple (NASDAQ:) were down about 1%, while Facebook (NASDAQ:), Google-parent Alphabet (NASDAQ:) and Microsoft (NASDAQ:) fell more than 3%.

Facebook, meanwhile, said it would launch a game streaming service to rival Google’s cloud gaming service Stadia.

Positive news on the vaccine front from AstraZeneca, meanwhile, did little to keep losses in check.

AstraZeneca PLC ADR (NYSE:) rose more than 1% after the company said its coronavirus vaccine candidate had triggered an immune response in both younger and older adults.

On the economic front, the rapid growth in housing activity slowed in September, with some warning of further slowing to come.  fell to 959,000 last month from 994,000 a month earlier, missing forecasts of 1 million.

“The single-family housing market is still registering strong demand … however, record-low supply is pushing up prices even faster, which is hindering potential buyers from affording new homes,” said Grant Thornton Economist Yelena Maleyev. “This will be exacerbated by the lack of additional COVID-19 support from Congress; the scars of this recession will run deep,” Maleyev added.

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Wall Street extends slide on virus worries, elusive stimulus deal By Reuters




© Reuters. FILE PHOTO: The Wall Street sign is pictured at the New York Stock exchange (NYSE) in the Manhattan borough of New York City

(Reuters) – U.S. stocks extended their slide on Monday, setting the Dow for its worst day in more than seven weeks, as soaring coronavirus cases and a deadlock in Washington over the next fiscal relief bill raised concerns over the economy and corporate earnings.

At 12:17 p.m. ET, the was down 731.56 points, or 2.58%, at 27,604.01, the S&P 500 was down 70.49 points, or 2.03%, at 3,394.90, and the was down 188.60 points, or 1.63%, at 11,359.68.

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