Fuel points will be unaffected at 12th Street. The future at SW 14th is unclear.
At least one of the two Kwik Shop locations in Newton will be sold as Kroger Co., the parent company of Dillons, sells stores nationwide.
According to Sheila Lowrie, Corporate Affairs Manager for Dillons/Baker/Gerbes, it is unknown how the sale of the convenience stores will affect customers who use fuel points earned at grocery stores for fuel discounts.
The 12th Street Kwik Shop in front of North Dillons will remain under Dillon's ownership.
"People will continue to be able to use their fuel points at that location," Lowrie said. "There are so many people inthe Newton area that commute for work ... Fuel points are important to our customers."
The store will be rebranded following the sale of more than 760 stores nationwide. It will retain by Dillons, primarily because it is currently on Dillon's property and its proximity to a Dillons store.
The store at SW 14th, across the street from South Dillons, will be sold as part of the deal. It is unclear what that will mean for customers and fuel points.
"It is uncertain how fuel points will be continued. We know fuel points are important to our customers, so we are in discussion with [the buyers] to see if there can be some sort of partnership, but we do not have those details at this time." Lowrie said.
It is, at this time, unknown what the closing date for the sale is. Lowrie said it will be before the end of the first fiscal quarter for Kroger. That quarter ends in May.
The Kroger Co. and EG Group, a privately-held petrol forecourt convenience store retailer based in Blackburn, Lancashire, United Kingdom, recently announced a definitive agreement for the sale of Kroger’s convenience store business unit to EG Group for $2.15 billion. The companies expect to close the transaction during the first quarter of Kroger’s fiscal year.
As part of the agreement, EG Group will establish their North American headquarters in Cincinnati, Ohio and continue to operate stores under their established banner names. About 762 stores will be affected by the sale.
Kroger announced in October 2017 its intention to explore strategic alternatives for its convenience store business, including a potential sale.
“Our convenience store business has been a part of our company for many years. We want to thank our management team and associates for their enduring commitment to our customers, and for the contributions they have made to build our supermarket fuel business,” said Mike Schlotman, Kroger’s executive vice president and chief financial officer. “As part of our regular review of assets, it has become clear that our strong convenience store business unit will better meet its full potential outside of our business.”
Kroger plans to use net proceeds from the sale to repurchase shares and to lower its net total debt to adjusted EBITDA ratio.
Kroger's convenience store business operates in 18 states. It includes 66 franchise operations. The stores employ 11,000 associates and operate under the following banner names: Turkey Hill, Loaf 'N Jug, Kwik Shop, Tom Thumb and Quik Stop. Kroger's convenience store business generated revenue of $4 billion, including selling 1.2 billion gallons of fuel, in 2016.