Kum & Go exploring strategic options

Kum & Go, a Des Moines, Iowa-based convenience store chain owned by the Krause family, could be exploring a sale of the business, among other options, that could value it at $2 billion, as reported by Reuters and confirmed by Axios.

Why it matters: As competition in the convenience store sector heats up, Kum & Go is likely to have several suitors. (Recall Iowa-based rival Casey's General Stores told Axios it plans to be an active acquirer.)

Of note: A sale is not necessarily preferable to other options, and JPMorgan Chase, which is advising the convenience store chain, is putting out feelers to gauge potential buyer interest now, a source familiar with the strategic review tells Axios.

• Kum & Go has conducted strategic reviews in the past, the source adds.

Details: Reuters reported that strategic options include refinancing, a sale-leaseback of its real estate, or another form of recapitalization, citing a person familiar with the transaction.

• "The sources cautioned that no transaction is certain and asked not to be identified because the deliberations are confidential," Reuters noted.
• Kum & Go owns more than 430 convenience stores in 11 states including Iowa, Colorado, Oklahoma and Missouri.

State of play: Some of the largest convenience store operators have played roles in consolidation in recent years, including 7-Eleven, Arko Corp. and Alimentation Couche-Tard.

• 7-Eleven bought Speedway from Marathon Petroleum for $21 billion, while Arko bought Pride Stores in Massachusetts for $230 million in December.
• EG Group is also said to be reviewing potential deals, with ongoing reports of merger talks between it and Couche-Tard.

What they're saying: Kum & Go and EG Group declined to comment. Casey's, 7-Eleven, Arko and Couche-Tard did not immediately respond to a request for comment.