Chevron ends bid to buy stations
Chevron Corp. said Friday that it called off plans to buy most of the gasoline stations owned by USA Petroleum Corp., which runs California’s largest network of independent outlets and is credited with inventing self-service fueling in the 1940s.
The two companies offered different reasons for ending the deal they announced in mid-July. Under that agreement, Chevron was to buy 122 of USA Petroleum’s 160 gas stations for an undisclosed sum.
Stephanie Price, a Chevron spokeswoman, described the breakup as “a business decision” and declined to elaborate. The San Ramon, Calif., company is the state’s largest fuel producer and vies with BP’s Arco brand to be the top retailer, with 1,200 stations selling gasoline under the Chevron and Texaco brands.
Mark Conant, president of Thousand Oaks-based USA Petroleum, said the sale collapsed because of aggressive scrutiny by the Federal Trade Commission, which was reviewing the deal’s potential effect on the California gasoline market.
“There was some resistance from the FTC,” Conant said. “They hadn’t turned it down, but it was pretty obvious that they would turn us down.”
Consumer advocacy groups and Sen. Barbara Boxer (D-Calif.) had criticized the proposed sale, arguing that independent stations such as those owned by USA Petroleum provide an important competitive check in a market dominated by big-oil brands.
Chevron’s purchase of the USA Petroleum stations could “present potential anti-competitive effects for consumers, including higher retail prices,” Boxer said in a letter to the FTC.
On Friday, Boxer applauded the end of the Chevron-USA agreement.
“I believe consumers will be better served without a continuation of consolidation that has eroded the competitive gas market over the past decade,” she said in a statement.
Conant said that USA Petroleum would go back to running its network of stations. “We’re not officially for sale,” he said.
When the planned transaction with Chevron was announced four months ago, Conant said the company was profitable and that USA Petroleum’s owner, John Moller, was just “taking some of the chips off the table” after 50 years in the business.
The first self-service gasoline station was opened in 1947 by independent marketer George Urich, according to the book “American Service Station: History and Folklore of Gas Stations in America.”
USA Petroleum subsequently bought Urich’s stations.
