Convenience operator Yesway completed a capital infusion that will help the fast-growing chain undergo an extensive store remodeling effort.
Yesway last year also acquired competitor Allsup’s and its 300 stores, so the new capital will help integrate the chain. The funding comes from Brookwood Financial Partners — Yesway's private equity founder — placing an additional $235 million in equity. In total, the firm has raised more than $642 million in equity capital for Yesway and arranged more than $237 million in sale-leaseback proceeds.
"Since founding Yesway approximately five years ago and acquiring the Allsup's Convenience Store chain last November, we have been extremely pleased with our integration efforts and how well the company has performed,” said Tom Trkla, Yesway’s chairman and CEO.
"As part of our integration of Allsup's, we have identified over $135 million in real estate capital projects within the portfolio, including razing and rebuilding 27 existing Allsup's stores, performing targeted upgrades to over 100 additional Allsup's stores, converting several existing Yesway stores in Texas to the Allsup's brand, significantly upgrading many of our existing Yesway-branded stores and adding new to market stores in communities which we have determined could benefit from an Allsup's store,” he said. “In particular, these improvements will allow us to offer the complete Allsup's food service program to Yesway customers, including, of course, the world-famous Allsup's Burrito."
The integration includes leveraging Allsup’s private label products. The company said over the past several years, under the direction of Mark Allsup, the son of Allsup's founders Lonnie and Barbara Allsup, the company has expanded its private label merchandise and its in-store assortment in general, completing more than 100 raze and rebuilds of existing Allsup’s that expanded those stores from 2,400 square feet to 4,800 square feet.
Yesway, based in Fort Worth, Texas, operates 402 stores throughout Texas, New Mexico, South Dakota, Iowa, Kansas, Missouri, Wyoming, Oklahoma and Nebraska, including the 304 Allsup’s stores. Yesway plans to grow its portfolio beyond 500 stores over the next several years.
The store remodeling campaign also includes a $7 million technology upgrade in all of Allsup’s stores, serving back-office software, in-store hardware systems and more that will help power a new, upcoming loyalty program called Yesway Rewards.