Last year, Z Energy bought Caltex New Zealand’s network of petrol stations from global oil giant Chevron. That was a pretty big deal (almost $800 million, in fact).
Just before Christmas 2016, another deal was announced. Caltex Australia* has bought the Gull New Zealand network of petrol stations (and associated operations). With a price of $340 million, it’s not as big as the Z Energy/ Caltex New Zealand deal, but still big numbers.
Caltex Australia was separate from Caltex New Zealand, although they obviously shared the same branding, and had some common ownership until recently. Caltex Australia is listed on the Australian stock exchange, and was half-owned by Chevron until 2015. Chevron have now sold out completely.
The Gull transaction is subject to Overseas Investment Office approval, which probably isn’t much of a barrier. You’ve just got one foreign-controlled company replacing another.
The press release is here:
This acquisition delivers on Caltex [Australia’s] strategic plan as it optimises Caltex’s infrastructure position, builds trading and shipping capability, grows the supply base and enhances Caltex’s retail fuel offering through low risk entry into a new market.
Gull has been successfully operating in the New Zealand fuel market since 1998 and is operationally positioned as a challenger brand. It has 77 retail sites in total, including 55 controlled retail sites (around one-third of sites unmanned) and 22 supply sites. It also provides fuel to numerous commercial (B2B) customers.
Gull sells around 300ML of transport fuel (petrol and diesel) representing around 5% of the New Zealand market. The Mount Maunganui terminal is the largest facility of its type in New Zealand with total storage of approximately 90ML. Whilst its retail network is concentrated in the northern half of the North Island of New Zealand, Gull is well placed to profitably grow via new to industry and/or new supply site expansions. As part of the transaction, Caltex will be retaining Gull’s Brand, management and employees.
Gull’s branding and position is based on selling petrol cheaper than everyone else, so presumably the new owners will keep that going.
In other news, things are also changing across the Tasman. Woolworths Australia, the company which owns Countdown supermarkets in NZ, is selling its 500+ petrol stations to BP Australia. The two companies have signed a “Strategic Partnership” to do fuel discounts together for the next 10 years – i.e. people shopping at Woolworths supermarkets in Australia will get the 4 cents off a litre at BP stations.
Which is to say, supermarket fuel dockets are likely to continue for another 10 years or so, at least in Australia. They’ve been in both NZ and Australia for 10 years already (see an earlier post on them here), and look set to stick around.
I’ve noticed things getting quite messy in the last year, in terms of different prices, vouchers and so on. At least twice, I’ve gone into a Mobil with a voucher to use, and been told that they’ve got a 10 cents off special running that day, so I don’t need the voucher. Then there’s AA Smartfuel, which works at Caltex and BP, and changes to which supermarket brand gives discounts at which petrol station brand.
There’s also more price variation in different parts of the city and country. So when you’re driving around, try to avoid being taken for a ride (zing!).
Econ 101 says it’s good to see that price variation – it’s a sign of competition and is supposedly good for overall “utility”. Drivers who are less price sensitive, or oblivious to the variations, end up paying more, and those who are more price sensitive don’t pay as much. But I’m sure you’d rather have the money in your own pocket. Even if you can’t be bothered carrying around vouchers (or keeping a Smartfuel card in your wallet), try to keep an eye out for where the petrol’s cheaper.
I did a road trip down the West Coast in early January – filled up in Greymouth, and tried to leave the next big fill-up to Wanaka. I figured the petrol in Wanaka would be cheaper than in the tiny village of Fox Glacier. Three pretty good reasons: Wanaka’s a bigger town, it’s got two petrol stations, and it’s less isolated. So I was quite surprised when the petrol price in Wanaka turned out to be higher than Fox Glacier (3 cents I think).
Then Queenstown was about 8 cents a litre less than Wanaka, and still about 8 cents more expensive than Auckland (again, from memory). Unsurprisingly, the prices tend to be much lower in the big cities and places on major highways – small, isolated towns have higher prices.