Press release
bp leans into convenience and mobility across US, agrees to purchase leading travel center operator, TravelCenters of America
- Adds a network of around 280 travel centers, strategically-located on major highways across US; complementing bp’s US convenience and mobility business.
- $1.3bn cash acquisition within bp’s $16-18bn frame, with acquisition multiple of around six times based on last 12 months’ TravelCenters EBITDA (4Q21-3Q22)i.
- Adds EBITDA immediately, expected to grow to around $800m by 2025, underpinned by investment, integration value and synergies.
- Expected to deliver over 15% returns and be accretive to free cash flow per share from 2024.
- Almost doubles bp’s global convenience gross margin.
- Brings growth opportunities for 4 of bp’s 5 transition growth engines including convenience, EV charging, biofuels/ renewable natural gas (RNG) and, later, hydrogen.
BP Products North America Inc., a wholly-owned indirect subsidiary of BP p.l.c. (NYSE: bp) has reached an agreement to purchase TravelCenters of America (Nasdaq: TA), one of the country’s leading full-service travel center operators. The acquisition, which is subject to regulatory and TravelCenters of America shareholder approval, will be for $1.3 billion in cash.
TA’s strategically-located network of highway sites complements bp’s existing predominantly off-highway convenience and mobility business, enabling TA and bp to offer fleets a seamless nationwide service. In addition, bp’s global scale and reach will, over time, bring advantages in fuel and biofuel supply as well as convenience offers for consumers. It will provide options to expand and develop new mobility offers including electric vehicle (EV) charging, biofuels, renewable natural gas (RNG) and later hydrogen, both for passenger vehicles and fleets.
Convenience is one of bp’s five strategic transition growth engines in which it aims to significantly grow investment through this decade. By 2030, bp aims for around half its annual investment to go into these transition growth engines. Over 2023-2030 it aims that around half of its cumulative $55-65 billion transition growth engine investment will go into convenience, bioenergy and EV charging.
Bernard Looney, CEO bp, said: “This is bp’s strategy in action. We are doing exactly what we said we would, leaning into our transition growth engines. This deal will grow our convenience and mobility footprint across the US and grow earnings with attractive returns. Over time, it will allow us to advance four of our five strategic transition growth engines. By enabling growth in EV charging, biofuels and RNG and later hydrogen, we can help our customers decarbonize their fleets. It’s a compelling combination.”
Webcast
bp's chief executive officer, Bernard Looney; chief financial officer, Murray Auchincloss; and EVP customers & products, Emma Delaney will host a webcast on Thursday 16 February at 4pm GMT to discuss bp's agreement to purchase leading travel center operator, TravelCenters of America
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