ConocoPhillips said Monday that it has sold its Circle K retail operations to Montreal-based Alimentation Couche-Tard for $830 million, leaving about 1,000 Tempe jobs in limbo.
The Tempe operation is the retail marketing arm of ConocoPhillips, and employees will be “off ConocoPhillips’ payroll” after the sale is completed, said ConocoPhillips spokeswoman Laura Hopkins. The Houston-based oil company plans to move retail marketing for its Conoco, Phillips 66 and 76 stores from Tempe to Houston, Hopkins said. Tempe has been the headquarters for those companies brands and Circle K.
But Circle K’s new owner does not plan to relocate the chain’s operations to Canada, so many of the Tempe employees are expected to be kept in their jobs hired into their old positions, said Real Plourde, Couche-Tard executive vice president and chief operating officer.
“It is not finalized, ” he said. “We will review the positions. But it is a good management team, and our intention is to retain most employees.”
Circle K has about 17,400 employees, mostly in its 1,663 U.S. company-owned stores, Hopkins said. Couche-Tard, which bought the stores, the brand and the franchise relationship with another 350 franchised or licensed stores, expects to keep the Circle K name as well as the store employees, Plourde said.
The purchase is contingent on government approvals and is expected to close in December, Plourde said.
No changes will be made until then, but Plourde said Couche-Tard officials will be meeting with employees as soon as possible to review operations and devise strategies for integrating the operations. He said some under-performing Circle K stores may close, but few, if any, of more than 500 Arizona stores will be dumped.
“The banner is very strong in Arizona,” he said. The Canadian company, the seventh-largest convenience retailer in North America, will become the fourth largest with 4,630 stores after picking up the Circle K’s. Couche-Tard, which loosely translates from the French as "night owl," already operates stores in the Midwestern United States under the Mac’s, Handy Andy and Dairy Mart banners.
Circle K has survived more than a half-century of ups and downs. Founded in El Paso, Texas, in 1951 when Fred Hervey purchased three Kay’s Food Stores, the company expanded into Arizona in 1957, adopting the Circle K name.
Circle K issued 96,000 shares of stock and became a public company in 1963. By 1975, the chain had grown to 1,000 stores. In 1983, the company introduced the Thirstbuster, taking on 7-Eleven’s Big Gulp.
A year later, Circle K bought 435 Little General stores and reported sales of $1 billion. But in 1990 the chain slipped into bankruptcy, emerging in 1993 after being purchased by Investcorp of New York for $340 million. In 1995 the company issued new stock and went public again.
Connecticut-based oil company Tosco Corp. bought Circle K for $900 million in 1996, forming Tosco Marketing Co. in Phoenix. In 1998, the company moved to a new campus in Tempe and sales topped $2 billion.
In 2001, Bartlesville, Okla.-based Phillips Petroleum Co. bought Tosco Corp. for $7 billion. Phillips chairman Jim Mulva said the company would shed retail stores and focus on oil, gas and refining operations. The company unloaded the stores in several batches before merging with Houston-based Conoco in 2002.