Silcorp

"Couche-Tard quickly developed a model that would guide its future stores. “Strategy 2000” is no doubt the best example of the four founders’ willingness to use the best ideas developed by other members of the Couche-Tard group as inspiration. The project was originally developed by the Mac’s division, just before Silcorp was taken over by Couche-Tard. It was then known as “Store 2000.” The model store was somewhat larger than most existing ones, sometimes as big as 280 square metres (3,000 square feet). It included a self-serve food court, with a coffee and bakery counter, as well as a fast-food section that was often concessioned to a well-known chain like Pizza Hut or Subway. Its most original feature was its decor: it could take the look of an old-time general store, mirror a European bistro or even an exotic jungle. Each establishment would determine its own interior design, based on its customer demographics. The idea was to make it an attractive destination, rather than a last resort that was convenient and nothing more."

"On the evening of Saturday, August 24, the four Couche-Tard founders found themselves at Bouchard’s home, sharing a nice meal to celebrate the start of the pan-Canadian adventure that was opening up before them. Now they had to plan their implementation schedule. In the middle of dinner, Fortin’s telephone rang. It was his contact at the Caisse de Dépôt. There was good news and bad news. The institution’s credit committee had agreed to finance the operation, but on the condition that it would raise Couche-Tard’s interest rates. Fortin swiftly took a hard stance, even though it risked scuttling the deal. There would be no question of renegotiating the agreement in principle that had been reached. If the Caisse didn’t stand by it, their word meant nothing. When the call ended, the mood at the gathering had lost its sparkle. If the financiers didn’t back down, they would have to abandon the project. Bouchard and Fortin would be flying to Toronto the following day. They had hoped they would be presenting their surprise offer to Silcorp’s president—who still knew nothing of their plan—on Monday. It was good that he was unaware, given the new circumstances. Would the meeting even come to pass? Fortin spent Sunday morning pacing at home, waiting for the telephone to ring. Had his refusal to allow the Caisse to change the deal at the last minute pushed the powerful financial institution into backing down, or made them dig in their heels? The answer came before noon: The initial agreement would be respected. They had the green light to start the acquisition process. It had been a close call, but their plan was still on track."

"Bouchard placed a phone call to Silcorp’s president, Derek Ridout in December. Bouchard had made progress in English, but he was still far from capable of holding a conversation fluently. In preparation, he wrote out what he wanted to say beforehand. To Bouchard’s great surprise, Ridout showed his cards during the call. He admitted straight out that he had never liked the convenience store industry. Bouchard wasn’t sure he understood. “You don’t like what you’re doing, and you continue to do it day after day?” he asked, incredulously."

"In the summer of 1996, taking advantage of a drop in Silcorp’s shares, Couche-Tard presented an unsolicited purchase offer of $16.50 per share—the equivalent of $74 million. It was a premium of 26 percent over the previous month’s average stock price. Silcorp’s share price immediately jumped to $17.00: A sign that the market anticipated a higher bid. That expectation was accurate."

"“They both said the deal was the best thing that ever happened to them in their career, and they encouraged me to give it a try.” Hannasch asked them why they thought so. The answer: because Couche-Tard management did what they had said they would do, they told him. They invested in the stores, took care of their people, worked to grow the business. And, they told him, since the company had acquired Silcorp, Couche-Tard’s management hadn’t broken its word—not once. “They’re four very humble guys with a vision of growing and doing the right thing,” said the two men, who added that in the business world, that’s “very refreshing.”"