Case Study: Matrix Announces the Successful Sale of
Toms Sierra Company, Inc.
Situation:
- Headquartered in Roseville, CA, Toms Sierra Company, (“Sierra” or the “Company”) operated a leading petroleum marketing and convenience retail chain outside of Sacramento, California. The Company’s stores operated under the Sierra Express brand name, which pays homage to their location in the foothills of the Sierra Nevada range.
- In 2017, at the request of the Company, Matrix provided their board of directors with a comprehensive valuation along with an update of the then current market conditions in the downstream energy and convenience retail sector. In subsequent years, Matrix continued to brief Sierra on market dynamics based on our experience derived from the significant volume of transaction activity within the sector.
- In 2019, the Company decided it might be time to exit the business and asked Matrix to update the valuation. After Matrix’s thorough analysis, we met with the Company’s board to discuss the likely valuation range for the assets and how a sale process could be structured to reach that value. At that point, Sierra’s board decided it was time to sell the Company to provide liquidity to the Company’s majority shareholder and engaged Matrix to manage the process.
Objective:
- Our objective was to customize, execute, and complete a confidential sale process that would allow Sierra’s shareholders to realize maximum after-tax value upon the sale of the Company.
Solution:
- Matrix provided merger and acquisition advisory services to Sierra, which included valuation advisory, marketing of the business through a confidential, structured sale process, and negotiation of the transaction.
- Multiple competitive offers were received, and 7-Eleven, Inc. was ultimately selected as the acquirer. As part of the transaction with 7-Eleven, Sierra’s fee simple real estate interest at certain properties was simultaneously sold to an institutional real estate investment trust (REIT) that entered into a long-term lease agreement with 7-Eleven.
- Matrix assisted in the negotiation of the asset purchase agreements with 7-Eleven and the REIT and also led the negotiation of the lease agreement between the two parties. Additionally, Matrix coordinated the due diligence and closing The transactions with 7-Eleven and the REIT closed in June 2021.
About Matrix’s Downstream Energy & Convenience Retail Investment Banking Group:
Matrix’s Downstream Energy & Convenience Retail Investment Banking Group is recognized as the national leader in providing transactional advisory services to companies in the downstream energy and multi-site retail sectors including convenience retailing, petroleum marketing & distribution, propane distribution, heating oil distribution, lubricants distribution, petroleum logistics, terminals and car washes. Group members are dedicated to these sectors and draw upon complementary experiences to provide advisory services to complete sophisticated merger and acquisition transactions, debt and equity capital raises, corporate valuations, special situations and strategic planning engagements. Since its inception in 1997, this dedicated group has successfully completed over 250 engagements in these sectors with a total transaction value of more than $12 billion.
For more information,
contact Cedric C. Fortemps, CFA
at cfortemps@matrixcmg.com
or 804.591.2039