Marathon Petroleum cites COVID-19 pandemic for decision to move target separation window,
FINDLAY, Ohio — Marathon Petroleum Corp. has revised the target date to spin off its Speedway LLC retail transportation fuels and convenience-store subsidiary into an independent, publicly traded company, MPC said on June 11 in a filing with the U.S. Securities and Exchange Commission. The new target is “early 2021.”
“In light of the impacts of the COVID-19 pandemic on market conditions, MPC continues to assess the timeline for the Speedway separation,” it said in the filing by Molly Benson, vice president, chief securities, governance and compliance officer and corporate secretary. “The initial target for the separation was the fourth quarter of 2020, but has been revised to early 2021. The separation remains subject to final approval by MPC’s board of directors, as well as the satisfaction or waiver of certain other customary conditions.”
Prompted by activist investors, as well as an ongoing evaluation of its business units, MPC began a strategic review of Speedway in 2017. Based on a recommendation from an independent committee, MPC decided to keep Speedway as an integrated business unit. By late 2019, however, continuing investor pressure and changes in the marketplace prompted it to decide to spin off the retail unit into an independent, publicly traded company. In January, MPC also began exploring a sale of Speedway rather than a spinoff, and attracted several major buyers, including Blackburn, U.K.-based c-store retailer EG Group, which through EG America LLC, owns the Westborough, Mass.-based Cumberland Farms c-store chain.
In February, Tokyo-based Seven & i Holdings Co. Ltd., the parent company of 7-Eleven Inc., Irving, Texas, entered into exclusive talks with MPC to acquire Speedway for approximately $22 billion. In March, Seven & i dropped its plan to buy Speedway, citing the coronavirus pandemic.
Findlay, Ohio-based Marathon Petroleum is an integrated, downstream energy company that operates 16 refineries. Its marketing system includes branded sites across the United States, including Marathon retail outlets. Speedway LLC, Enon, Ohio, owns and operates approximately 4,000 convenience stores.
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