EET Retail, the retail arm of Essar Energy Transition Fuels, has acquired UK-based petrol station operator SGN Retail, creating the UK’s second-largest backward-integrated forecourt operator.
The deal is estimated at £400 million-£450 million ($540 million-$607 million), according to sources. A company spokesperson declined to comment on the transaction value.
The acquisition will be funded through a combination of cash and a new £250-million senior debt facility arranged by an eight-bank group comprising First Abu Dhabi Bank, Macquarie Bank, Mizrahi Tefahot Bank, Natixis, OakNorth Bank, Royal Bank of Canada, SMBC Bank International and Sound Point Capital Management, EET said.
The transaction will add 118 stations to EET Retail’s portfolio. Combined with its existing network of 117 sites, the acquisition will give the company a nationwide mobility platform of 235 fuel stations, with annual throughput of more than 650 million litres.
SGN Retail, founded by Graham Peacock and Susan Tobbell, will help accelerate EET Retail’s plan to expand its footprint and directly supply fuel to 800 forecourts across the UK by 2031. The company is targeting a 9% market share in the UK forecourt sector.
EET said demographic growth, the rise in multi-car households and the declining number of petrol stations in the UK offered an attractive investment opportunity in the forecourt sector.
“The acquisition accelerates our plan to build a nationwide, vertically integrated platform of 800 sites, backed by direct refinery supply and delivering competitive prices at the pump for UK motorists,” Arvan Ruia, CEO of EET Retail, said.
EET Fuels and EET Retail were advised by RBC Capital Markets as financial adviser, and Herbert Smith Freehills Kramer and Weightmans as legal advisers.