Prior to this acquisition, Petro was a privately owned company headquartered in El Paso, Texas. Its majority owner was a Texas family and minority interests were owned by affiliates of Exxon Mobil and AB Volvo of Sweden.
The combined properties total 233 facilities in 41 states and Canada.
Both truckstop brands will be operated separately after the transaction closes, said Thomas O’Brien, president and CEO of TA. “Each of the TA and Petro operations excel at certain aspects of the travel centers business,” he said. “I expect the combined company will benefit by utilizing the best practices of each company.”
TA was spun out of Hospitality Properties Trust as a separate public company in January 2007.
Petro operates and franchises 69 travel centers in 33 states. The travel centers operated by Petro generally are newer and larger than the 164 travel centers TA operates and franchises.
The Petro assets acquired by TA include two owned centers, one partially owned center and two leased centers operated by Petro, Petro’s franchisee business that provides services to 24 centers operated by Petro franchisees, related businesses, four land sites acquired for future development of new travel centers, inventory and other working capital.
TA’s purchase price for these assets, including closing costs and the cost of certain Petro employee retention payments, is approximately $70 million.
TA funded the transaction using cash on hand.
Simultaneously with TA’s acquisition of Petro, HPT acquired the remaining 40 Petro travel centers and leased them to TA for an initial net rent of $62.2 million a year through 2024 with renewal options thereafter. Starting after 2012, HPT’s rent will increase annually based upon percentages of increased gross revenues at the leased centers.
In addition to its purchase price of approximately $630 million, HPT has agreed to pay certain costs of this transaction, including prepayment of debt secured by the Petro properties being acquired by HPT and customary closing costs. HPT estimates that these costs may be approximately $25 million.
- Max Heine and Randy Grider
GATS Builds on Success With Ninth Annual Show
The ninth annual Great American Trucking Show is shaping up to be one of its biggest and best events yet, according to show organizers. The show takes place Aug. 23-25 at the Dallas Convention Center in downtown Dallas.
By the first of June, GATS Executive Director Alan Sims said the show had “more space commitments than we did the first day of the show in 2006. The show is very near being sold out, and that is with a considerable addition of exhibit space in Hall D.”
Last year, GATS was named as the “Fastest Growing Consumer-Hybrid Show” by Tradeshow Week – it was one of only three shows nationwide to receive top honors.
This year will feature scores of industry exhibitors, free educational seminars and renowned entertainment.
From OEM truck and parts manufacturers to fleets to trucking industry organizations, the exhibit hall will offer a wealth of information about the industry under a single roof and a space for networking with other trucking professionals, according to the show’s website, gatsonline.com, where a full list of exhibitors is available.