By LOU WILIN
Gary Heminger, Marathon Petroleum’s chief executive officer, was excited and colorful Thursday about buying Hess Corp.’s retail operations.
“This transaction will be transformative for the enterprise,” he said to analysts.
“This really fits us like a glove and it’s going to tee us up for long-term growth,” he said later.
“When I look now at (Marathon Petroleum) with this transaction: east of the Rockies, top refining system, top pipeline system, top terminal system and top retail and marine system. So we have many, many levels of optionality on how we can try to enhance the value from this portfolio,” he said.
Pretty bold, snappy stuff from a guy who does not thrive on delivering the sound bite.
It should not be a surprise.
“He could not contain himself” before analysts last fall when asked about Hess plans to sell or spin off its 1,256 stores, said Fadel Gheit, senior energy analyst for Oppenheimer.
“He went out of his way to praise Hess,” Gheit said.
Heminger has wanted to expand Marathon Petroleum’s retail subsidiary Speedway.
The $2.87 billion purchase price announced Thursday is fair but “at the high end of the street,” Gheit said.
At least one other Hess suitor emerged last fall. BJ’s Wholesale Club was interested in buying the Hess stations, Dow Jones & Co. reported.
But Heminger got the prize.
“I would have been disappointed if I was to see this asset, this transaction would have gone to some other party because I think there is so much synergy that we can bring to the table,” he said Thursday.
He called the purchase a “rare opportunity … to accelerate our plans to grow the higher-valued, more stable cash-flow segments of our business.”
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