Kum & Go Acquisition: Key Details, Impact, and What Comes Next

Maverik's acquisition of Kum & Go marks a significant milestone in the convenience store industry. This strategic move expands Maverik's footprint to over 800 stores across 20 states, positioning it as a major player in the market. The merger promises to enhance customer experiences and elevate product offerings, creating a best-in-class convenience store network.

What Is Kum & Go?

Founded in 1959, Kum & Go is a convenience store chain known for its diverse offerings, including fuel savings, fresh coffee, and branded merchandise. The company differentiates itself with its &Rewards program, which provides fuel discounts and exclusive rewards. Additionally, Kum & Go engages customers through unique sweepstakes and a user-friendly mobile app that offers deals on fuel and food. Their focus on a customer-centric atmosphere sets them apart in the market.

Who Acquired Kum & Go?

Maverik, known as "Adventure's First Stop," is a prominent convenience store chain and the largest independent fuel marketer in the Intermountain West. Operating over 400 locations across 13 states, Maverik offers a variety of services including freshly made BonFire Food, fuel with Nitro Card savings, and exclusive rewards through its Adventure Club. The company's extensive network and commitment to quality and value solidify its strong market presence in the region.

When Was Kum & Go Acquired?

Maverik completed its acquisition of Kum & Go on August 29, 2023. This strategic move comes amid a period of significant consolidation in the convenience store industry, reflecting broader trends of expansion and diversification. The timing aligns with Maverik's ongoing efforts to enhance its market presence and community support initiatives, such as their $50,000 donation to The Des Moines Public Schools Foundation. The acquisition also positions Maverik to better navigate industry shifts, including the rise of electric vehicles.

Why Was Kum & Go Acquired?

• Market Expansion: The acquisition of Kum & Go significantly expands Maverik's footprint to over 800 stores across 20 states, making it the 12th largest convenience store chain in the U.S. This move enhances Maverik's presence in the Midwest and Rocky Mountain regions, allowing it to tap into new markets and customer bases.
• Technology Integration: Maverik benefits from Kum & Go's advancements in electric vehicle (EV) charging stations, which will help Maverik enhance its own EV offerings. Additionally, Maverik plans to roll out self-checkout lanes and new payment systems at Kum & Go locations, starting in Colorado and Utah, to improve operational efficiency and customer experience.
• Competitive Advantage: The acquisition creates a best-in-class convenience store network, offering a differentiated customer experience across fuel, foodservice, and in-store offerings. By leveraging the combined resources and operational efficiencies, Maverik strengthens its market position and enhances its ability to compete against other major convenience store chains.

Acquisition Terms

• Acquisition Price: The exact sale price was not disclosed. However, earlier reports suggested that the Krause Group was seeking nearly $2 billion for Kum & Go.
• Payment Method: The payment method used for the acquisition was not specified in the available information.
• Key Conditions or Agreements:
  • Chuck Maggelet will lead the newly combined organization.
  • Tanner Krause will transition out of the company after a short period of support during the integration.
  • Maverik will donate $50,000 to The Des Moines Public Schools Foundation.
  • Rebranding of Kum & Go stores in Colorado, Idaho, Utah, and Wyoming will start in January, with other locations still under consideration.
  • About one-third of Kum & Go stores will be rebranded to Maverik, particularly in states where both companies have stores.
  • The acquisition includes Solar Transport, a tank truck carrier and logistics provider owned by Krause Group.
  • Maverik plans to maintain a corporate office in the Des Moines area and operate a Basecamp in addition to its headquarters in Salt Lake City.
  • Kum & Go’s nearly 5,000 employees will be retained by Maverik.

Impact on Kum & Go

The acquisition of Kum & Go by Maverik has led to significant changes in operations and management. Chuck Maggelet, Maverik's CEO, will lead the combined organization, while Tanner Krause, Kum & Go's CEO, will transition out after a brief support period. Maverik plans to rebrand Kum & Go stores in Colorado, Idaho, Utah, and Wyoming starting in January, while maintaining the Kum & Go brand in other states. Additionally, Maverik will introduce new payment systems and self-checkout lanes at Kum & Go locations, enhancing operational efficiency and customer experience.

Product offerings and services are also set to evolve. The merger aims to integrate Maverik's adventurous and differentiated convenience store experience into Kum & Go locations, potentially sharing popular items like Maverik's pizza and Kum & Go's burrito sandwiches. Employee reactions have been cautiously optimistic, with Maverik welcoming nearly 5,000 Kum & Go employees. Customer reactions are yet to be fully gauged, but the focus on enhancing service and product offerings suggests a positive outlook. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly and efficiently.