Puma stalking Coles and Woolies

Independent petrol retailer eyeing $1 billion acquisition of United Petroleum

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Puma Energy is eyeing an acquisition that could see its share of the petrol retailing market more than double from 4% to 10% and put extra competitive pressure on the major retailers.

Puma, owned by Dutch-based commodities trader Trafigura Beheer, is already Australia's largest independent petrol retailer, after purchasing Ausfuel for $625 million from private equity firm Archer Capital. The Ausfuel deal had 110 retail sites and 11 depots in Western Australia, Northern Territory and South Australia.

That came hot on the heels of the company's acquisition of Neumann Petroleum in January at an estimated cost of more than $250 million. Neumann owned 125 Neumann and Matilda-branded petrol stations along Australia's east coast, as well as a bulk fuel terminal in Brisbane.

Now Puma is interested in United Petroleum, which operates a chain of petrol stations across Australia, as well as fuel import terminals in several states and could sell for as much as $1 billion. United also sells bulk fuel products to other independents, fuel distributors, mining sites and marinas.

Currently Woolworths (ASX:WOW) and Wesfarmers (ASX:WES) owned Coles control around 50% of the petrol market, with Caltex Limited (ASX:CTX) holding 17%. BP, 7-Eleven and the independents share the leftovers.

Coles and Woolworths are already under pressure for the use of petrol shopper dockets from the competition regulator, with Australian Competition and Consumer Commission (ACCC) chairman Rod Sims suggesting the petrol discounts could amount to predatory pricing or abuse of market power. With discounts hitting 40 cents a litre, depending on the size of the customers shopping basket, Mr Sims said that he was concerned that we could see just two companies selling petrol in Australia.

Many associations such as the Australian Retailers Association, Master Grocers Australia and Australian Newsagents have already called on the government to end the petrol shopper docket discount schemes.

Foolish takeaway

More competition would be good for the sector, but it could also result in pushing more of the independents out – similar to the supermarket sector where Woolies, Coles and Metcash (ASX:MTS) backed IGA stores dominate.

Interested in our #1 dividend-paying stock? Discover The Motley Fool's favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of "The Motley Fool's Top Dividend Stock for 2013-2014."

More reading

Motley Fool writer/analyst Mike King owns shares in Woolworths.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »