Viva Energy is one of the largest petrol station and convenience store owners in the nation, but to be honest, OTR does it better.
Viva sells fuel through a national network of more than 1300 petrol stations under the Shell and Liberty brands, and is currently in the process of acquiring the Coles Express outlets which number more than 700.
The $4.8bn ASX-listed company also owns a refinery at Geelong, and is considering building a liquefied natural gas import terminal at that site.
But while the Viva fuel offer has wide geographic spread, it is the convenience stores operated by OTR which are the real prize.
The Shahin Family has built up OTR from one petrol station in Woodville, purchase by Fred Shahin in 1984, to a network of more than 170 outlets, mostly based in South Australia.
The key to the company’s success has been integrating excellent convenience store offers – it is pretty much possible to do a decent shop in one of their stores – as well as sophisticated car washes and restaurants such as Subway and Guzman y Gomez into their sites.
The family also famously brought Krispy Kreme to Adelaide.
OTR has also developed a sophisticated digital offering, allowing customers to pay for fuel, order coffee and win prizes.
Viva, in its statement to the ASX, said it would take them “years” to develop what OTR has already built, hence the rationale for the purchase – as well as the fact that the OTR business is highly profitable.
The company’s chief executive Scott Wyatt was clear on this point.
“The introduction of OTR’s superior convenience offering, including quick serve restaurants, will help revolutionise the diversity and attraction of our retail offering,” Mr Wyatt said.
“As our stores increasingly become retail destinations, we expect convenience earnings will grow and reduce our dependency on traditional fuels.
“OTR outlets offer an attractive and welcoming store environment, supporting increased dwell time, which is likely to be a key factor in successfully introducing electric vehicle recharging facilities over time.”
From the Shahin perspective, the family’s business interest are now widespread, including The Bend motorsport park at Tailem Bend, as well as significant property interests.
And with the move to electric vehicles likely to be a challenge for petrol stations going forward, arguably the timing is just right.
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