Maverik/Kum & Go Divested Stores to "Good 2 Go" - FTC?

[storewanderer]

So there is a block of Maverik Stores out in UT/CO/WY that got divested back in 2023. Supposedly there was something with FTC but I cannot find any public release regarding anything to do with the FTC and Maverik in recent years.

They seem to have divested 9 Maverik units near Kum & Go units.

This operator "Good 2 Go" appears to be run by a fuel wholesaler. I've been into some of these locations they have in AZ/NM/ID and they are not a very good operator at all. Cash/credit pricing in markets where nobody else does that and just really not great stores. Locked restrooms. They appear to basically be a hodgepodge of random gas stations that were formerly single unit operators. The "Good 2 Go" branding appears to be somewhat recent, previously they seem to have just run them as generic convenience marts. I cannot imagine how they will run the larger Maverik units. They seem to be bringing in Rusty Taco to replace the food program Maverik had. Rusty Taco went out of business rapidly in Reno and I heard nothing but awful things about the place (so bad I never tried it). This will be interesting to watch.

Also a lot of negative Google Reviews on the below former Maverik units since they were taken over by this outfit. I have no clue what this outfit was thinking- with Quik Trip moving into Colorado and explicitly targeting these newer areas...

Most of the divested stores were newer Maverik units. Some were the older 10+ year old Maverik units but had been given full remodels where they shut down for a month to do the remodel it is so major, within the past 2 years (such as the one in Castle Rock). I am very surprised they divested these and kept the Kum & Go units which are older and just not as nice.
They divested the following stores:

107 Laura Ct., Dacono, CO
2129 Barr Place, Brighton, CO *this site had grand opening as Maverik in July 2023 and was sold to this Good 2 Go in September 2023!
4817 North Salida, Denver, CO
3991 Limelight, Castle Rock, CO
7491 Black Forest, Colorado Springs, CO
711 East Fillmore, Colorado Springs, CO
6180 Timber Rail Point, Fountain, CO
5075 West Herriman Blvd., Herriman, Utah
1616 East Highway 14-16, Gillette, Wyoming

[ClownLoach]

Here we go...

This is why I am of the opinion that if there is to be a deal like the Kroger-Albertsons merger they should just do their own divestiture lists within reason and defined guidelines. The FTC uses outdated, worthless methodology like Zip codes which are based on populations from decades ago. They would probably direct a Fred Meyer to be divested and the Safeway across the street to be kept even though there is no competent operator available for the FM store. They make bad decisions that ultimately waste money, for your example that brand new Maverik is now a loss while they are going to have to spend big on fixing the older kept sites which ultimately will lead to higher prices for the consumer.

The FTC's failure point is accepting "anyone" such as this low quality "Good 2 Go" as a operator even if they are not qualified or refuse to run a similar quality operation. The FTC will just pat themselves on the back and hoist the "mission accomplished" sign then go back to whatever it is that they do. Meanwhile these "Good 2 Go" stations will likely fail and close, or reduce the services available to the consumer as they cannot deliver a competitive offering. The divest was to maintain competition but that has obviously not happened. It sounds like the consumer would be better off if Maverik operated all these locations, even if there was possibly less pressure on price because the community is losing available services. Price is one factor but cannot be the only factor considered, that thinking has led to food deserts and other problems over the years as merger divestitures have effectively turned into 2nd class and 3rd class operations that ultimately fail even if their prices are low because of the loss of services, reduced quality of offerings, and so forth.

That is what has made several recent deals interesting. I would argue that 7-Eleven may have been almost too honest in their divestiture selections. Yes, they basically chose to ignore the FTC but they also did a good job of maintaining competition. I can think of an area near me where they sold 2 sites and kept one, and the better of the three sites were what they sold to Jackson's.

I think Kroger and Albertsons probably would have a good site selection process for the most part under reasonable direction and whatever they chose to keep vs. divest would probably be much better for every community involved instead of a FTC list that might do bizarre things like equate a tiny Safeway with a Frys Marketplace. And yes, in some cases they would probably divest less stores because they would be forced to keep sites that are destined for eventual closure in the standalone prececessors instead of jettisoning them into a unsuspecting buyer where they will serve as dead weight, anchoring profits and revenue. Instead of just giving up their problems they'd be forced to face them head on and maybe use their combined resources to try to salvage these sites instead of dumping their problems on others, like maybe that Vons doesn't work for the customer base but it would do better with a Ralphs format.

What has made the Kroger-Albertsons deal interesting is that it has challenged the long standing FTC process. The FTC obviously isn't just accepting the unqualified buyer that is C&S. In the past they probably would have been cheering about the success of forcing a flagship Pavilions to become a Piggly Wiggly as they're "maintaining competition" while failing to recognize that no, a supermarket isn't a supermarket- they're not all the same and many other aspects of the community impact need to be understood such as the impact of in store pharmacy, removal of services by a lower end acquiring operator and so forth.

So this Maverick deal pretty much solidifies the argument of the incompetence of the FTC in site selection as they were probably told that they had to keep those sites and sell those other sites. If the FTC is going to decide what you actually receive when you buy a company, I think that is a bit unreasonable especially when it is not in any way shape or form merger of "equals" and that is not something they've ever taken into consideration.

The FTC should allow the merging companies to choose the sites and just give them both rules and a three strikes process. State what kind of outcome they're looking for (such as no direct overlaps across the street or around the corner from each other, and must divest X hundred stores minimum to spread out market share), and give them three chances to present a self-divest list for approval along with their rationale for selection so they can't just "dump" unwanted sites. If they fail to make an acceptable list three times then and only then does the FTC take over and declare what stays and what goes. The entire focus of the FTC should be on the selection of qualified buyer(s) who will actually operate the divested units in a similar manner (so for example not convert a Vons to a no frills format and close pharmacy, service depts etc.). The merging entities should not be able to choose their new competitor. Then it becomes very simple. If there are not enough qualified buyers then the merger is to be blocked.

Right now it's all about the sites to the FTC, but fact is there is always a buyer for divestitures... But the validity of the buyer is what really either maintains competition or allows it to be destroyed in these deals.

The entire process is upside down, and until this proposal there really hasn't been enough discussion of why the decades-old (maybe century old?) merger divestiture remedy is no longer relevant and needs to be rewritten or replaced.

[storewanderer]

This post implies FTC was involved but there is nothing official on FTC about it.

Looking at how it went it appears Maverik divested the stores immediately before taking formal control of Kum & Go in which case they never had overlap because there was no period where they operated these sites and the Kum & Go sites at the same time.

~ttps://www.reddit.com/r/ColoradoSprings/commen ... _stations/

These stations won't close. If this operator Good 2 Go can't make them work some other large chain will. Also even if this Good 2 Go blows the stores and kills traffic in store, being a fuel wholesaler, does change the economics a bit for the sites. They're getting margin twice on the fuel first on wholesale then again at retail. As long as they move sufficient fuel volumes they'll probably be fine.

I notice the sites they took from Maverik are mostly unbranded and most of their other AZ NM etc. sites are branded. For some reason they put Conoco branding on the Herriman, UT site. It also appears they signed up with Pilot to put One 9 branding on the diesel islands in the ones that had those islands. So they do appear to be trying some things.

And if it doesn't work these sites could be viable for many other operators due to the quality of the site.

[ClownLoach]

This post implies FTC was involved but there is nothing official on FTC about it.

Looking at how it went it appears Maverik divested the stores immediately before taking formal control of Kum & Go in which case they never had overlap because there was no period where they operated these sites and the Kum & Go sites at the same time.

~ttps://www.reddit.com/r/ColoradoSprings/commen ... _stations/

These stations won't close. If this operator Good 2 Go can't make them work some other large chain will. Also even if this Good 2 Go blows the stores and kills traffic in store, being a fuel wholesaler, does change the economics a bit for the sites. They're getting margin twice on the fuel first on wholesale then again at retail. As long as they move sufficient fuel volumes they'll probably be fine.

I notice the sites they took from Maverik are mostly unbranded and most of their other AZ NM etc. sites are branded. For some reason they put Conoco branding on the Herriman, UT site. It also appears they signed up with Pilot to put One 9 branding on the diesel islands in the ones that had those islands. So they do appear to be trying some things.

And if it doesn't work these sites could be viable for many other operators due to the quality of the site.

That does change the argument a bit. The Maverik branded station with a more premium large convenience store and food operation is different from a Maverik operated Conoco or other label with generic c-store. So they aren't really being downgraded by this Good 2 Go?

[storewanderer]

This post implies FTC was involved but there is nothing official on FTC about it.

Looking at how it went it appears Maverik divested the stores immediately before taking formal control of Kum & Go in which case they never had overlap because there was no period where they operated these sites and the Kum & Go sites at the same time.

~ttps://www.reddit.com/r/ColoradoSprings/commen ... _stations/

These stations won't close. If this operator Good 2 Go can't make them work some other large chain will. Also even if this Good 2 Go blows the stores and kills traffic in store, being a fuel wholesaler, does change the economics a bit for the sites. They're getting margin twice on the fuel first on wholesale then again at retail. As long as they move sufficient fuel volumes they'll probably be fine.

I notice the sites they took from Maverik are mostly unbranded and most of their other AZ NM etc. sites are branded. For some reason they put Conoco branding on the Herriman, UT site. It also appears they signed up with Pilot to put One 9 branding on the diesel islands in the ones that had those islands. So they do appear to be trying some things.

And if it doesn't work these sites could be viable for many other operators due to the quality of the site.

That does change the argument a bit. The Maverik branded station with a more premium large convenience store and food operation is different from a Maverik operated Conoco or other label with generic c-store. So they aren't really being downgraded by this Good 2 Go?

Maverik doesn't operate any Conocos or other labels with generic c-stores. They operate either Maverik banner or Kum & Go banner.

The downgrade would be subjective- Maverik has a loyalty program, proprietary food program, a reputation, promotions, etc. To some customers none of that matters, to other customers it draws them into Maverik. So what may be indifferent to some customers is going to impact other customers.

At the end of the day low cost fuel will draw in customers but I doubt the stores can be as productive as they were under Maverik.