Contact Information: Contact: Ms. Milton Gray Draper Director of Investor Relations 650-589-9445 X3027
Core-Mark Announces a Definitive Agreement to Acquire Auburn Merchandise Distributors, Inc.
| Source: Core-Mark Holding Company, Inc.
SOUTH SAN FRANCISCO, CA--(Marketwire - May 9, 2008) - Core-Mark Holding Company, Inc.
(NASDAQ : CORE ), one of the largest North American distributors to the
convenience retail industry, announced today that it has signed a
definitive agreement to acquire substantially all of the assets of Auburn
Merchandise Distributors, Inc. for approximately $28 million. The assets
being purchased include primarily accounts receivable, inventory and fixed
assets. This agreement does not provide for the purchase of real property
or significant liabilities. Core-Mark expects to fund the transaction from
excess availability under its $250 million Revolving Credit Facility and
from working capital that will be generated after the close. The deal is
expected to close in June and be accretive in 2008 excluding approximately
$1.4 million in start up and conversion costs.
Auburn has historically generated annual sales of approximately $260
million and is well positioned to service a multi-state geography,
complementing the Core-Mark distribution footprint in the Northeast
marketplace.
"We are very pleased to be joining the Core-Mark family and look forward to
being part of a company with such a great reputation for customer service
and a history of success. We believe that together with Core-Mark we will
have a team very well suited to serve the Auburn customers," said Bill
Potvin, President of Auburn Merchandise Distributors.
"Auburn's history of putting the customer first with fast, flexible service
resonates highly with our culture and business practices," said Scott
McPherson, Senior Vice President of Core-Mark. "We are very impressed with
the Auburn team and believe that this synergistic combination will result
in continued great service with more marketing programs and products to
help Auburn's customers grow their sales."
Core-Mark
Core-Mark is one of the largest broad-line, full-service wholesale
distributors of packaged consumer products to the convenience retail
industry in North America. Founded in 1888, Core-Mark provides distribution
and logistics services as well as marketing programs to over 22,000 retail
locations in 45 states and five Canadian provinces through 25 distribution
centers, two of which Core-Mark operates as third party logistics
providers. Core-Mark services traditional convenience retailers, grocers,
drug, liquor and specialty stores, and other stores that carry consumer
packaged goods. For more information, please visit www.core-mark.com.
Safe Harbor
Except for historical information, the statements made in this press
release are forward-looking statements made pursuant to the safe-harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on certain assumptions or estimates,
discuss future expectations, describe future plans and strategies, contain
projections of results of operations or of financial condition or state
other forward-looking information. Our ability to predict results or the
actual effect of future plans or strategies is inherently uncertain.
Although we believe that the expectations reflected in such forward-looking
statements are based on reasonable assumptions, actual results and
performance could differ materially from those set forth in the
forward-looking statements.
Forward-looking statements in some cases can be identified by the use of
words such as "may," "will," "should," "potential," "intend," "expect,"
"seek," "anticipate," "estimate," "believe," "could," "would," "project,"
"predict," "continue," "plan," "propose" or other similar words or
expressions. These forward-looking statements are based on the current
plans and expectations of our management and are subject to certain risks
and uncertainties that could cause actual results to differ materially from
historical results or those discussed in such forward looking statements.
Factors that might cause or contribute to such differences include, but are
not limited to our dependence on the convenience store industry for our
revenues; competition; price increases; our dependence on relatively few
suppliers; the low-margin nature of cigarette and consumable goods
distribution; certain distribution centers' dependence on a few relatively
large customers; competition in the labor market and collective bargaining
agreements; product liability claims and manufacturer recalls of products;
fuel price increases; our dependence on our senior management and key
personnel; currency exchange rate fluctuations; our ability to borrow
additional capital; governmental regulations and changes thereto;
earthquake and natural disaster damage; failure or disruptions to our
information systems;; a general decline in cigarette sales volume;
competition from sales of deep-discount brands and illicit and other low
priced sales of cigarettes. See the "Risk Factors" section included in our
Form 10-K, our most recent Form 10-Q and all other information discussed in
our filings with the Securities and Exchange Commission for a discussion of
risks and uncertainties that may affect our business. Except as provided by
law, we undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.