Essar Subsidiary Set to Acquire UK Fuel Retailer for Approximately $550 Million
Essar Energy Transition’s retail division has announced its acquisition of UK forecourt operator SGN Retail in a deal valued at approximately £400 million ($540 million or ₹5,166 crore). This acquisition adds 118 sites to Essar’s existing network, expanding its total to 235 locations as it aims to establish a vertically integrated fuel business in the UK.
Details of the Acquisition
EET Retail, part of Essar Energy Transition Fuels, confirmed it will acquire 100% of SGN Retail, which was co-founded by Graham Peacock and Susan Tobbell. While specific financial details were not disclosed, sources indicate the deal is estimated at £400 million. The acquisition will enhance EET Retail’s annual fuel throughput to over 650 million liters by combining SGN’s 118 sites with its own 117 locations.
The expanded network positions EET Retail as the second-largest forecourt operator in the UK, with plans to grow to approximately 800 sites by 2031. This expansion is expected to capture about 9% of the UK market, with fuel supplied directly from Essar’s Stanlow refinery in Cheshire.
Strategic Implications
Arvan Ruia, CEO of EET Retail, emphasized that building a vertically integrated retail forecourt platform is crucial for the company’s long-term strategy in the UK. He described SGN Retail as one of the highest-quality forecourt networks in the country, stating that the acquisition accelerates their goal of establishing a nationwide platform supported by direct refinery supply, which will help deliver competitive prices at the pump.
EET aims to reconnect fuel production with retail distribution, addressing the fragmentation in the UK’s fuel market that has occurred over the last two decades due to reduced investment from oil majors in domestic refining. The company believes this model will enable more direct distribution of fuel refined at Stanlow to its forecourts, minimizing reliance on imports and streamlining the domestic supply chain.
Financing the Deal
The acquisition will be financed through a mix of cash and a new £250 million senior debt facility. This facility has been arranged by a consortium of banks, including First Abu Dhabi Bank, Macquarie Bank, Mizrahi Tefahot Bank, Natixis, OakNorth Bank, and the Royal Bank of Canada, among others. This backing reflects confidence in Essar’s backward-integrated growth model and the UK fuels and convenience markets.
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