Golden Gate Petroleum, Inc.

Service Type: M&A

Client: Golden Gate Petroleum, Inc.

Client Description: Multi-branded and unbranded wholesaler and retailer of petroleum products in the Central and Northern California and Nevada markets. Golden Gate Petroleum operated 21 retail facilities and c-stores, with 4 retail development sites, and 7 plant facilities including: tank farms, office space, warehouses, and a refinery in Reno, Nevada.

The Trigger:

  • After much deliberation and rigorous analysis of its key skill sets, the Company decided to exit its retail business segment to focus its strategy on wholesale distribution to develop its refinery and bio-diesel plant, and redeploy capital to its preferred business lines.

The Project:

  • The Company engaged Corner Capital Advisors to assist in the divestiture of 21 real estate locations, and 4 retail development sites.
  • The foundation of the Company was built around its wholesale distribution business; the retail segment developed in response to a rising need to support its wholesale operations through cardlock facilities and fleet fueling systems.
  • The Company’s operating strategy made its retail business cumbersome, leading the Company to seek a divestiture in pursuit of greater operational focus and a return to its founding business model.

The Solution:

  • The Company’s retail assets were located in carefully chosen geographies, targeting under-served coastal markets in California with strong commercial and residential traffic.
  • 18 of the 21 operating retail sites offered diesel and/or biodiesel, comprising 43% of the Company’s network volume—given that the California market was undersupplied with diesel fuels, the Company’s divestiture offered potential buyers high margins that exceeded national averages.

The Result:

  • The Company divested of its retail assets to numerous individual buyers, in addition to leasing (sub-leasing) the remaining facilities to 7-Eleven.