7-Eleven Inc. has agreed to buy the Wilson Farms convenience store chain, an ownership change that eventually will result in the rebranding and franchising of the stores, company officials say.
Terms of the deal, which was announced Wednesday and is expected to close by June, were not disclosed. The homegrown Wilson Farms chain consists of 188 stores in New York State.
Wilson Farms locations are currently owned by WFI Group, which is led by the Nanula family and a New York City private equity firm, Bruckmann, Rosser, Sherrill & Co.
WFI employs about 2,300 people at its stores and 60 at its corporate offices in Amherst.
"Wilson Farms has a successful store operation, quality locations and a strong customer-service culture," Stanley W. Reynolds, 7-Eleven's executive vice president and chief financial officer, said in a statement. "The combination of the two companies will strengthen our convenience offering in the Western New York area."
The deal will enable 7-Eleven to dramatically increase its presence in the Buffalo and Rochester markets, where it currently has 21 locations, said Margaret Chabris, a 7-Eleven spokeswoman at the company's headquarters in Dallas. 7-Eleven bills itself as the largest chain in the convenience retailing industry, with more than 40,500 locations worldwide.
7-Eleven plans to invest in remodeling the stores and to convert the locations to the 7-Eleven banner starting later this year. The company also will move toward franchising the locations to franchisees.
The long-term impact on the corporate employees, and whether 7-Eleven will maintain corporate offices locally, has not yet been determined, Chabris said. "I think the Wilson Farms team is really great. We need them, particularly through this transition," she said. "There are not going to be any immediate changes."
It also will be a "business as usual" approach for now for employees at the 188 stores as the locations are converted into 7-Elevens, Chabris said.
7-Eleven's business model uses licensees and franchisees who operate its 6,700 U.S. locations. As the Wilson Farms stores are converted into 7-Elevens, franchisees will have the say over employment in the individual locations. Chabris said the conversion into franchised locations will take some time.
Chabris said 7-Eleven plans to learn the "best practices" used at the Wilson Farms stores and continue using those as they become 7-Eleven locations.
In 2005, WFI Group bought Wilson Farms from the Dutch supermarket giant Ahold, which had operated the chain as a division of Tops Markets. Paul S. Nanula was named president and CEO, and his father, Savino P. Nanula, a co-founder of Tops, was named chairman.
WFI said last fall that Wilson Farms generated $400 million to $500 million a year in sales. 7-Eleven said that it generated worldwide sales of more than $62.7 billion last year.
Paul Nanula said he and Daniel J. Shanahan, vice president and chief financial officer, will remain with Wilson Farms through the transition and serve as consultants for about six months after the deal is closed. They then will look for other opportunities. "We think we've got a pretty good track record of running businesses," Nanula said.
Nanula said he feels proud that WFI had built up the Wilson Farms chain to the point where an industry powerhouse such as 7-Eleven wanted to acquire it. He said that 7-Eleven initiated the talks and that the purchase process began about seven months ago.
"I think it is a great opportunity for growth for 7-Eleven buying the Wilson Farms chain," Nanula said.
But the deal also means that the Wilson Farms name, which dates from 1969, will soon disappear from the retail landscape. Nanula said he is sorry to see the banner go but is gratified that 7-Eleven will invest more in the chain. "It's a 42-year history," he said.
Nanula said he also was proud of the work of Wilson Farms' employees and the charitable causes the chain had supported over the years.
The acquisition is not a case of Bruckmann Rosser or the Nanula family actively seeking to sell off Wilson Farms and exit the business, Nanula said. "There was nothing compelling either one of us to sell the company," he said. "It was just a good fit at a good time."
WFI had received other offers in the past, including previously from 7-Eleven, Nanula said.
Nanula said WFI has invested about $26 million in Wilson Farms stores in the last six years. He said, "7-Eleven is going to continue that and ramp that up."