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Refining giant Marathon Petroleum Corp. announced late Sunday that it's selling its Speedway retail gasoline stations and convenience stores to 7-Eleven, Inc. in a $21 billion cash deal.
Why it matters: It's the year's biggest energy deal thus far, the Wall Street Journal notes.
- The deal comes as energy companies are under intense financial pressure due to the COVID-19 pandemic. Marathon reported an adjusted second-quarter loss of $868 million this morning.
- However, the seeds of the deal were planted before the crisis. "Marathon, under pressure from activist investor Elliott Management, said last year it would launch sweeping restructuring, including spinning off Speedway," Reuters notes.
The big picture: Marathon said the estimated $16.5 billion in after-tax proceeds will be used to "strengthen balance sheet and return capital to shareholders."
- 7-Eleven said the deal would add about 3,900 Speedway stores located in 35 states, allowing the company to diversify its U.S. footprint, especially in the Midwest and East Coast.
- Under the deal, Marathon will supply 7-Eleven with 7.7 billion gallons of fuel annually for 15 years.