BP Products North America, a 100% indirect subsidiary of BP, has agreed to acquire TravelCenters of America (TA), a NASDAQ-listed full-service travel center operator, in an all-cash deal worth $1.3 billion.

Shareholders of TravelCenters of America will be paid $86 per share by BP, which is a premium of 84% to the average trading price of the 30 days ended 15 February 2023 of $46.68.

Jonathan M. Pertchik — TravelCenters of America CEO said: “Today’s announcement that BP is acquiring TA for $86 per share is a result of the successful implementation of our turnaround and strategic plans.

“We have improved our core travel center business, expanded our network, launched eTA to prepare for the future of alternative fuels and improved our operating and financial results, none of which we could have accomplished without the hard work and dedication of our employees at every level.”

The strategically-located network of highway locations of TravelCenters of America is said to supplement the existing largely off-highway convenience and mobility business of BP. This will enable both parties to provide a seamless pan-US service to fleets.

Furthermore, the global scope and reach of BP are expected to eventually offer benefits in biofuel and fuel supply, as well as better convenience products for customers. The deal will result in offering alternatives to increase and create new mobility options, including electric car (EV) charging, renewable natural gas (RNG), biofuels, and, later, hydrogen, for both fleets and passenger vehicles.

Bernard Looney — BP CEO said: “This is bp’s strategy in action. We are doing exactly what we said we would, leaning into our transition growth engines. This deal will grow our convenience and mobility footprint across the US and grow earnings with attractive returns.

“Over time, it will allow us to advance four of our five strategic transition growth engines. By enabling growth in EV charging, biofuels and RNG and later hydrogen, we can help our customers decarbonize their fleets. It’s a compelling combination.”

The acquisition by BP Products North America could bring approximately 280 TravelCenters of America sites, that span 44 states in the US, into the portfolio of BP. These travel centers, which cover an average of 25 acres, provide the full spectrum of services for vehicles or fleets of trucks such as more than 600 quick and full service eateries, as well as maintenance and repair of trucks.

About 70 percent of TravelCenters of America’s gross margin is derived from its convenience service business, which is nearly double of the global convenience gross margin of BP.

Earlier this week, BP announced plans to inject an amount of $1 billion into EV charging in the US by the end of this decade.

As part of the deal, TravelCenters of America will sign amended lease agreements with NASDAQ-listed Service Properties Trust to set up access to long-term real estate.

The closing of the deal is subject to regulatory approval and TravelCenters of America’s shareholders’ approval.

  Bernard Looney, BP, BP Products North America, Jonathan M. Pertchik, Service Properties Trust, TravelCenters of America, USA