NEW YORK -- Marathon Petroleum (IW 500/13) will acquire Hess's gasoline and convenience store business for $2.6 billion in a deal creating one of the biggest U.S. players in the sector, the companies said Thursday.
Marathon Petroleum will buy 1,342 Hess stores along the East Coast, the largest chain of company-operated gas stations and convenience stores in the region.
Marathon Petroleum will also acquire Hess's transport operations and shipper history on various pipelines, including about 40,000 barrels per day on the Colonial Pipeline, which provides gasoline and other petroleum products to southern and eastern points in the U.S. from refineries in the U.S. Gulf Coast.
The deal makes Marathon Petroleum's Speedway chain of gasoline and convenience stores the nation's largest by revenue and second-largest by store count, Marathon Petroleum said.
"This acquisition will be transformative for Marathon Petroleum and Speedway as it will significantly expand our retail presence from nine to 23 states through these premier Hess locations throughout the East Coast and Southeast," Marathon CEO Gary Heminger said.
Hess plans to use the proceeds from the sale to boost its share repurchases.
Hess CEO John Hess said the deal represents the culmination of his company's transformation from an integrated oil company with oil and gas production and refining and marketing assets into a "pure-play" oil and gas producer.
Copyright Agence France-Presse, 2014