The parent company of Certas Energy, the Irish conglomerate DCC plc, has reached agreement to buy Esso’s retail petrol station network in Norway for NOK2.43bn (£235m).
The network is the third largest in Norway with approximately 20% of retail volumes. It comprises 142 company-operated sites (127 retail service stations and 15 unmanned stations) and has contracts to supply 108 Esso-branded dealer owned stations.
Esso Retail Norway sells about 600mlpa of fuel annually. The majority of the stations are in the more populous south of the country and, of the 142 company-operated sites, 110 are held freehold, with 32 being leasehold. As part of the transaction DCC Energy will enter into long-term brand and supply agreements.
Since December 2015, the convenience retail element of the company-operated sites has been operated by NorgesGruppen, the largest grocery retailer and wholesaler in Norway, under a long-term agreement. NorgesGruppen have been rolling out its Deli de Luca retail concept across the network.
Esso Retail Norway will be integrated into DCC Energy’s retail IT and operating infrastructure. This infrastructure was developed during 2015 to enable DCC Energy’s integration of the Esso France retail business.
It was designed to be scalable and facilitate a “hub and spoke” operating model, where key pricing, supply and back office functions can be operated remotely from an operations centre near Dublin, Ireland, enabling the management of the business in conjunction with local management teams.
The transaction is subject to regulatory approvals, and is expected to complete in the final calendar quarter of 2017.
Tommy Breen, chief executive of DCC plc, said: “The acquisition of Esso Retail Norway is another material step for DCC in building its retail petrol station business in Europe.
“From a modest position three years ago, DCC Energy will, following completion, operate over 1,000 retail petrol stations and is ambitious to continue this development. “The acquisition is consistent with our aim to operate world-renowned retail fuel brands and be an excellent partner for oil majors.”