Rival's shares fall as Topaz agrees takeover
Shares in Applegreen tumbled by around 5pc yesterday as main rival Topaz announced it was being bought by Canadian giant Alimentation Couche Tard.
Topaz chief executive Emmet O'Neill will leave the company when the takeover by the Quebec-based firm closes early next year.
The deal, estimated by industry analysts to have an enterprise value of between €350m to €450m, was announced yesterday and will see the Irish company, which has been owned by businessman Denis O'Brien for the last two years, subsumed into the Couche Tard empire.
Couche Tard has around 15,000 sites across its network in North America, Europe, Asia and the Middle East, employing around 100,000 people.
Topaz has a network of 464 service stations, and employs more than 2,000. Former Taoiseach Brian Cowen is among those on the board.
Mr O'Neill, who has been chief executive since February, said it was a "truly monumental day for Topaz".
He added: "[This is] something we're absolutely thrilled to have achieved.
"The last few years have a been a period of transformation from Topaz and we've moved from an organisation that was challenged and was weak and had an uncertain future, into a business which is the number one operator in the country, extremely well invested, well branded and well respected."
Topaz, which has just closed on its deal to buy Esso, approached Couche Tard over the summer, although the latter said it had been looking at Topaz for the last five or six years.
Brian Hannasch, Couche Tard chief executive, said the Topaz stores would be branded Circle K, the global brand for Couche Tard, but no decision has yet been taken on the fuel brand.
He said the existing Topaz employees have nothing to be concerned about. Mr O'Brien, the founder of the mobile phone company Digicel and a key shareholder in the publisher of this newspaper, took control of the convenience and fuel retailer in December 2013 after he bought loans attached to the business from the liquidators of the former IBRC. Those loans had a face value of around €300m, and Mr O'Brien reportedly bought them for €150m in the liquidators' auction.
The Topaz loan sale falls outside the scope of a judicial review into losses incurred at IBRC because it took place after the bank was placed into liquidation.
Topaz recently got the green light to close its acquisition of the Esso brand in Ireland.
The company's annual turnover now, including the Esso brand, is around €4bn.
Couche Tard has operations throughout the US and Canada, as well as Norway, Sweden, Denmark, Poland, the Baltics and Russia, Asia and the Middle East.
Mr Hannasch said they don't have any specific ideas yet other than to grow the business but said they would rely on local management.
"We don't come in with any preconceived ideas about what the right thing to do here is yet," he said.
He said the deal will be subject to EU competition approval. It is expected to close in the first quarter of next year.
Couche Tard says Topaz is a good strategic fit within its European network.
"It has an extensive and attractive convenience and fuel network, with good locations, quality forecourts and stores, an excellent food offering and very professional teams," Europe group president Jacob Schram said in a statement.