Clayton, Dubilier & Rice-backed Motor Fuel Group completed its acquisition of MRH, the UK’s largest petrol station and convenience retail operator. The transaction is valued at approximately £1.2 billion ($1.6686 billion).
MFG and MRH together will operate more than 900 sites, which are predominantly company-owned and franchisee-operated. They manage third-party fuel, convenience and foodservice brands. These include fuel brands BP, Esso, Jet, Murco, Shell and Texaco and retail brands Budgens, Costa Coffee, Greggs, Spar and Subway, as well as the MRH-owned brand, Hursts. On a combined basis, MFG and MRH sold approximately 3.6 billion liters of fuel in 2017.
Alasdair Locke, chairman of MFG, will remain chairman of the combined business. Sir Terry Leahy, a senior advisor to CD&R’s funds and former chief executive of Tesco, will continue to serve on the board of directors and chair the executive committee of the board.
“Both MFG and MRH operate in a stable market and are highly focused on convenience with a track record of consistent growth and commitment to operational excellence,” said CD&R Partner Marco Herbst. “As petrol forecourts transition to customer-focused convenience and food-to-go hubs for local communities, this platform is distinctly positioned to meet this growing demand across the U.K.”
According to Reuters, BNP Paribas, Goldman Sachs and HSBC are leading the debt financing alongside Deutsche Bank, ING, RBC and Societe Generale.
The transaction is expected to close in Q2/18, subject to customary regulatory approvals.
Goldman Sachs International, RBC Capital Markets and Investec Bank served as M&A advisors, and Clifford Chance and Debevoise & Plimpton served as legal advisors to MFG. MFG received due diligence support from Alix Partners, Ernst & Young and McKinsey. Management at MFG was advised by Dorsey & Whitney (Europe) and Wyvern.
Lazard served as M&A advisers, and Weil, Gotshal & Manges provided legal advice to MRH. MRH also received due diligence support from PwC and OC&C. Charles Russell Speechlys provided advice to MRH management.
