Somerfield to get Texaco forecourt shops

FOOD retailer Somerfield is on the verge of tying up a deal with Texaco to buy 140 forecourt convenience shops, a source close to the company has told This is Money.

The companies signed a memorandum of understanding in February and the deal is expected to be finalised by April 28 after due diligence is completed.

Texaco has informed forecourt staff the deal will be done by the end of April and is in talks with other parties to sell the remaining 110 locations.

It expects those stores to be sold before the end of the year as it continues its strategy of concentrating resources on refining and distribution. It will continue to supply fuel to the forecourts.

Somerfield has been in talks with Texaco for some months and plans to sell and lease back the stores to property venture capitalist Palmer Capital Partners when the deal is complete.

Under the deal, PCP would finance the acquisition through its joint venture partner Deutsche Property Asset Management, while PCP's seven regional companies will help with the development of the stores.

A Somerfield spokeswoman said the deal would proceed despite interest from several buyers interested in taking over the UK's fifth largest supermarket chain.