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Large TA shareholder wants board to give Arko same data access as BP

Letting spurned bidder see data will ‘create upside’; stock market suggests BP’s $86 price will rise

A large shareholder at TA is asking the travel center operator to let ARKO see more data. (Photo: Jim Allen/FreightWaves)

A significant shareholder in TravelCenters of America is asking the truckstop chain to speak with convenience store chain Arko about the latter’s bid for TA, which is for a higher per share price than that of oil giant BP, which is on track to buy TA next month.

In an open letter to the TA board, TIG Advisors, which says it owns 4.9% of TA, calls it “in the best interest of all TA shareholders for the board to immediately permit ARKO access to TA’s data room.”

In a letter sent by Arko (NASDAQ: ARKO) management last month to TA (NASDAQ: TA), Arko complained that it had not been provided access to some data and that TA was unresponsive to Arko queries. Arko has bid $92 per share for TA. But TA, citing issues with Arko’s credit rating and the concerns about it raised by TA “landlord” SVC, is sticking with a BP bid of $86 per share and has rejected the ARKO offer.

Access to the data room would “provide ARKO with the information it requires to submit an unconditional binding proposal,” TIG said in its letter. “Allowing ARKO the opportunity to legitimize its offer only creates upside for the Company and its shareholders. If, following proper diligence, it becomes evident that ARKO cannot satisfy the basic requirements to acquire TA, then we intend to support the BP transaction.”


TA has relationships with two publicly traded companies that hold significant sway in stopping TA from pursuing a bid from Arko. One is real estate investment trust SVC (NASDAQ: SVC), which is the landlord for TA’s travel centers. The second is RMR (NASDAQ: RMR), which provides consulting services to TA. SVC owns 7.8% of TA’s shares and RMR owns 4.1%. Both are backing the BP offer.

SVC in particular has cited Arko’s credit rating, which is not investment grade, as a key reason why it opposes the Arko bid and plans to vote its shares in favor of the BP bid. If Arko were to acquire TA, it would be Arko that is responsible for the rents paid to SVC for the properties where TA’s stores are sited.

TA management, TIG said in the letter, is “prioritizing the interests of Service Properties Trust and The RMR Group above TA shareholders, the true owners of the Company.”

The TA board has let its fiduciary duties to TA shareholders “fall by the wayside,” TIG charged.


“To be clear, we are not requesting that the Board immediately abandon the BP proposal in favor of the ARKO proposal,” TIG said. Access to the data room would give Arko “the opportunity to legitimize its offer” which would “create upside for [TA] and its shareholders.”

If that due diligence does not “satisfy the basic requirements to acquire TA,” then TIG said it will support the BP (NYSE: BP) bid.

The letter said Arko has “shared viable answers to each concern the Board has publicly levied against it.”

In particular, the concern about Arko’s credit rating would be bolstered — according to the Arko plan — by Arko entering into an agreement with an unidentified investment-grade insurance company that would provide backing for the bid. 

Equity markets are suggesting they believe there is still an opportunity for a higher number than $86 to acquire TA. TA closed Wednesday at $88.02 per share, up 0.65%. Its intraday high was $88.16. The stock has traded consistently above $87 for the past week and touched a 52-week high Monday at $88.55.

“Don’t sell shareholders short,” the TIG letter said. “We urge the Board to act now.”

TIG referred to a suggestion in the latest Arko letter that it might alter its bid, though as TIG notes, it was not clear whether that would be an increase in the price Arko is bidding or would make other changes to persuade SVC and RMR to look favorably on its bid.

“Delaying this process further due to inefficient public correspondence would be a major disservice to TA and all its shareholders,” the letter said.


TA was not immediately available for comment. Throughout this process, it has only communicated through press releases, which are often identical verbiage to Securities and Exchange Commission filings it has made in connection with the TA/Arko/BP dance.

TIG says it has about $8 billion under management primarily for institutional investors.

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John Kingston

John has an almost 40-year career covering commodities, most of the time at S&P Global Platts. He created the Dated Brent benchmark, now the world’s most important crude oil marker. He was Director of Oil, Director of News, the editor in chief of Platts Oilgram News and the “talking head” for Platts on numerous media outlets, including CNBC, Fox Business and Canada’s BNN. He covered metals before joining Platts and then spent a year running Platts’ metals business as well. He was awarded the International Association of Energy Economics Award for Excellence in Written Journalism in 2015. In 2010, he won two Corporate Achievement Awards from McGraw-Hill, an extremely rare accomplishment, one for steering coverage of the BP Deepwater Horizon disaster and the other for the launch of a public affairs television show, Platts Energy Week.