Competition Bureau requires Couche-Tard to sell two gas stations in Esso deal

Alimentation Couche-Tard has agreed to sell two gasoline stations in Ontario and Quebec to resolve Competition Bureau concerns about the convenience store chain's purchase of nearly 300 Esso locations from Imperial Oil for about $1.7 billion.

The federal agency says the Quebec-based retailer will sell a Mac's-branded retail gas station in Carleton Place, Ont., and the Esso-branded station in St-Bruno-de-Montarville, Que.

It found Couche-Tard would have controlled more than 35 per cent of the market in those municipalities without the sale, opening the door for the company to raise gas prices or reduce the rate of price discounting.

Imperial Oil agreed last March to sell its 497 Esso retail stations to five fuel distributors, including Couche-Tard.

Couche-Tard's acquisition means Canada's largest convenience store operator will see its fuel market share increase to about 20 per cent in Ontario and Quebec, putting it in range of rivals Petro-Canada, Shell and Ultramar.

The sites it acquired from Imperial Oil will continue to sell Esso-branded gasoline.

The deal also expands Couche-Tard's relationship with Tim Hortons by adding 229 full-service or smaller kiosks.

Since the Imperial Oil deal was first proposed, Couche-Tard recently announced the largest acquisition in its history with a US$4.4-billion friendly deal to buy Texas-based CST Brands. Couche-Tard simultaneously announced plans to sell a majority of CST's Canadian assets to Parkland Fuel Corp. of Red Deer, Alta. (TSX:PKI).