ARKO Petroleum’s planned acquisition of the business of U.S. Petroleum Partners is expected to add approximately 280 million gallons of annual fuel volume and more than 400 dealer locations, significantly expanding the fuel distribution subsidiary’s scale across the Great Lakes region.
The additional volume would represent approximately 14% growth on a trailing twelve-month basis, giving ARKO Petroleum a larger commercial footprint following the growth strategy the company outlined around its initial public offering.
ARKO also expects the acquired operations to contribute approximately $30 million of annualized Adjusted EBITDA and increase Discretionary Cash Flow. The transaction is intended to broaden ARKO Petroleum’s earnings base while creating additional cash-generation capacity.
Beyond dealer locations and fuel volume, the acquisition would add two fuel terminals and expanded transportation capabilities. ARKO expects those assets to improve vertical integration, strengthen supplier relationships and expand fee-based earnings streams, with additional potential benefits from increased throughput and operating synergies.
Consideration at closing is expected to include $205 million in cash plus the cost of inventory. ARKO Petroleum would also issue $30 million of its Class A common stock, which would initially be held in escrow and released to the seller based on the acquired business achieving certain EBITDA targets during the first four full quarters following closing.
The transaction comes as ARKO continues repositioning its broader convenience-store and fuel platform. During Q2, the company converted another 21 retail stores to dealer locations, bringing cumulative conversions under its dealerization program to 471 since 2024.
That strategy has shifted the composition of ARKO’s network. At the end of Q2, the company operated 1,057 retail sites compared with 1,254 a year earlier, while its wholesale network increased to 2,129 sites from 2,014.
ARKO is also continuing to build out its fleet-fueling business, targeting 20 additional locations during 2026. One opened in March, two opened in July and another 17 were in progress. The company also repurchased approximately $37.9 million of its outstanding 5.125% senior notes during the quarter at a discount.
The broader company generated $122.9 million of Adjusted EBITDA during the first six months of 2026, up 14% from $107.8 million in the prior-year period. ARKO has pointed to Wholesale and Fleet Fueling as important elements of the diversified model it is building alongside the transformation of its retail network.
The U.S. Petroleum Partners transaction would accelerate that shift by increasing the scale of ARKO Petroleum while adding infrastructure that can support fuel distribution, transportation and additional acquisition activity.
KEY QUOTES:
“We expect that the recently announced acquisition of the business of US Petroleum Partners will be an important next step in APC’s growth strategy, aimed at increasing scale while creating additional opportunities to enhance supplier economics, throughput and cash generation.”
“We continue to make progress across dealerization, remodels, loyalty and other transformation initiatives as we convert our network into a more focused, resilient and higher cash flow business. Our solid first-half performance, together with our diversified business model and continued execution across the organization, positions us well to achieve our reaffirmed full year 2026 Adjusted EBITDA outlook and create long-term value for our shareholders.”
Arie Kotler, Chairman, President and Chief Executive Officer of ARKO
