Pantry To Purchase 40 Convenience Stores

SANFORD, N.C. (AP) — Pantry Inc. said Tuesday that it will buy 40 convenience stores and some land from Herndon Oil Corp. as it looks to enter the Mobile, Ala., market.

Terms were not disclosed.

Pantry, which runs convenience stores in the southeastern U.S., said it will pay for the transaction with available cash.

"This acquisition fills a gap in our existing store base and represents our initial entry into the attractive Mobile market," Chief Executive Peter J. Sodini said in a statement.

The deal also includes the underlying land of 32 of the stores, which operate under names including Flamingo.

Pantry said 32 of the stores are in Alabama, six are in Florida and two are in Louisiana and Mississippi.

The acquisition is targeted to close during the second half of fiscal 2009. It is expected to add to earnings per share during the first year after the deal's completion.

Pantry operated 1,648 stores in 11 states as of Friday.