Slide 1: Schedule 14A Definitive Additional Materials
UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 14A (Rule 14a-101) INFORMATION REQUIRED IN PROXY STATEMENT SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant ¨ Filed by a
Slide 2: Schedule 14A filing fee information
(5) Total fee paid: ¨ Fee paid previously with preliminary materials. ¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or t
Slide 3: Presentation materials of Alimentation Couche-Tard Inc.
The following are presentation materials of Alimentation Couche-Tard Inc.:
Slide 4: Offer to Acquire Casey's General Stores
Alimentation Couche-Tard Offer to Acquire Casey’s General Stores September 2010
Slide 5: Important Information
Important Information This communication does not constitute an offer to buy or solicitation of an offer to sell any securities. A tender offer (the “Tender Offer”) to purchase (1) all issued and outstanding shares of common stock, no par value, of Casey’s General Stores, Inc. (“Casey’s”), and (2) t
Slide 6: Table of contents
Table of contents 1. Overview of Couche-Tard’s offer 2. Couche-Tard is offering compelling value for Casey’s 3. Casey’s Board must be replaced 4. Responses to Casey’s misinformation campaign Appendix 2
Slide 7: Overview of Couche-Tard's offer
1. Overview of Couche-Tard’s offer 3
Slide 8: Alimentation Couche-Tard means "late night snack"
Alimentation Couche-Tard means “late night snack” FY2010 Sales • Largest independent convenience store operator in North America by company-operated stores Canada 22% • #1 Canadian convenience store operator • Enterprise value of $4.8 billion and market cap of $4.3 billion as of US September 1, 2010
Slide 9: Couche-Tard is committed to acquiring Casey's
Couche-Tard is committed to acquiring Casey’s Compelling offer • Compelling offer: $38.50 cash per Casey’s share for Casey’s • 53% of Casey’s shareholders tendered at $38.00 per share in Casey’s self-tender shareholders • 17% premium to all-time and 52-week high prior to our announcement on April 8,
Slide 10: Couche-Tard is committed to acquiring Casey's (cont'd)
Couche-Tard is committed to acquiring Casey’s (cont’d) Couche-Tard has • Raised its offer above the price at which a majority of Casey’s shareholders were willing to sell their shares listened to Casey’s • Secured acquisition financing shareholders Couche-Tard is • Full support of Couche-Tard’s Boar
Slide 11: Couche-Tard has secured financing and ample liquidity
Couche-Tard has secured financing and has ample liquidity to fund the all-cash transaction Couche-Tard has secured favorable financing with attractive terms sufficient to fund the entire cash consideration • Up to $1.5 billion 4-year unsecured term loan facility, which complements existing, unused r
Slide 12: Chronology
Chronology • October 6, 2009 – Alain Bouchard contacted Robert Myers about a possible business combination only to be turned down without a discussion • November 13, 2009 – Mr. Bouchard contacted Mr. Myers again to reiterate Couche-Tard’s interest and was asked to submit any proposal in writing • Ma
Slide 13: Couche-Tard is offering compelling value for Casey's
2. Couche-Tard is offering compelling value for Casey’s 9
Slide 14: Casey's shareholders have spoken on value
Casey’s shareholders have spoken on value • Casey’s tender offer for up to approximately 25% of its own stock at $38.00 to $40.00 per share expired on August 25, 2010 – 26.8 million shares – ~53% of the then outstanding shares of Casey’s were tendered at the minimum purchase price of $38.00 per shar
Slide 15: Casey's stock price performance since IPO
Casey’s stock price performance since IPO Couche-Tard’s cash offer of $38.50 per share $38.50 Casey’s 52-week and all-time high price of $32.83 per share +17% premium $25.67 $12.83 $0.00 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 Source: FactSet Research Systems. Prior to Couche-Tard’s offer,
Slide 16: Casey's is fully valued by Couche-Tard's offer
Casey’s is fully valued by Couche-Tard’s offer • Prior to Couche-Tard’s offer, Casey’s was covered by eight analysts, who had a mean target price of $33.74 per share – Casey’s is a well-run business, whose value was recognized by the market prior to our initial offer – The market understood Casey’s
Slide 17: Paying a high multiple on peak gasoline earnings
Couche-Tard is paying a high multiple on peak gasoline earnings, despite gasoline margin volatility • Gasoline retail sales constitute 68.5% of Casey’s FY2010 sales and 22.5% of Casey’s FY2010 gross profit • Recent industry retail gasoline margins are unsustainably high and have benefited from: – A
Slide 18: Premium multiple to precedent C-store transactions
Couche-Tard’s offer is at a premium multiple to precedent C-store transactions Enterprise Value / LTM EBITDA 8.6x Implied transaction multiple: 7.5x 7.9x 7.5x Average 6.6x 6.3x 6.1x 5.8x 5.5x 5.4x 5.1x 5.1x Susser / Wellspring Green Valley Couche-Tard / The Pantry / Sunoco / Uni-mart / Tosco / Apoll
Slide 19: Premium multiple to precedent C-store transactions (cont'd)
Couche-Tard’s offer is at a premium multiple to precedent C-store transactions (cont’d) Enterprise Value / Store Implied Couche-Tard transaction multiple: ($ thousands) $1,355 $1.3 million per store $958 $868 $725 Average: $662 $499 $494 $400 $315 $342 Wellspring Green Valley Couche-Tard / The Pantr
Slide 20: Premium to other all-cash unsolicited offers since 1997
Couche-Tard’s offer is at a premium to other all- cash unsolicited offers since 1997 Premium of final offer to 52-week high Premium of final offer to all-time high Roche Holding / Ventana Medical Systems 39% Couche-Tard / Casey's 17% Unilever / Bestfoods 22% Investor Group / Taubman Centers* 11% Ast
Slide 21: Casey's stock price would have declined without the offer
Casey’s stock price would have declined if not for Couche-Tard’s offer Since Couche-Tard's public announcement on April 8th… • The hoped for “summer of recovery” didn’t materialize and fear that the economy is heading into a severe double dip recession has increased • Major market indices have decli
Slide 22: Casey's is correlated to the S&P Retail Index
Casey’s is correlated to the S&P 500 Retail Index • Casey’s doesn’t correlate perfectly to any index • The S&P Retail Index(1) is a capitalization-weighted index of 29 domestic equities in the retail sector, traded on the New York Stock Exchange, American Stock Exchange and NASDAQ • Casey’s stock tr
Slide 23: Casey's is correlated to the S&P Retail Index (cont'd)
Casey’s is correlated to the S&P 500 Retail Index (cont’d) S&P Retail Index(1) Casey’s Implied Share Price $38.50 $31.59 466 412 $27.89 April 8, September 1, Casey's Share Implied Casey's Share Couche-Tard's 2010 2010 Price on April 8, Price based on the S&P all-cash offer 2010 500 Retail Index Note
Slide 24: Casey's share price would have decreased based on major indices
Casey’s share price would have decreased based on major market indices • Recent C-store sector stock market performance has been affected by Couche-Tard’s offer – Not a good indication of Casey’s unaffected stock price – C-store peers are trading at a premium due to takeover rumors spurred by Couche
Slide 25: Casey's equity research price targets
Casey’s equity research price targets • Couche-Tard’s all cash offer is a 26% premium to the average present value of Casey’s equity research analyst price targets prior to making our offer public • Subsequent to Couche-Tard’s offer, Casey’s equity research price targets increased • Couche-Tard’s al
Slide 26: Leveraged recapitalization does not increase shareholder value
Casey’s leveraged recapitalization does not increase value for its shareholders • Empirical evidence and academic studies contradict the fallacy that EPS accretion from stock buy backs leads to increased stock prices Rappaport. Ten Ways to Create Shareholder Value. 2006. Harvard Business Review Oded
Slide 27: P/E ratios are volatile
P/E ratios are volatile Historical P/E ratios 20 15 10 Average: 13.4 Standard deviation: 1.4 5 2006 2007 2008 2009 2010 20 15 10 Average: 15.9 Standard deviation: 2.1 5 2006 2007 2008 2009 2010 20 15 10 Average: 15.1 Standard deviation: 1.6 5 2006 2007 2008 2009 2010 Across the market, in the C-stor
Slide 28: P/E ratios decreased in almost half of share repurchases
In almost half of all share repurchases announced, P/E ratios have decreased Performance of P/E ratios of companies that have announced a share repurchase, adjusted for market movements over the year following the announcement 175 150 75 percentile 125 Median 100 75 25h percentile 50 25 Announcement
Slide 29: Very weak relationship between EPS growth and TSR
Very weak relationship between EPS growth and TSR EPS profile is only one factor in TSR How much has EPS growth explained total returns over the last 3 years? What about over the last 5 years? 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% -10% -10% -20% -20% -30% -30% -40% -40% -300% -150% 0% 150% 300% -300
Slide 30: Casey's Board must be replaced
3. Casey’s Board must be replaced 26
Slide 31: Board more interested in preserving jobs than shareholders' interests
Casey’s Board seems to be more interested in preserving their jobs than serving shareholders’ best interests Refuse to engage • Casey’s has rejected all of Couche-Tard’s offers in dialogue • Casey’s continues to refuse to meet or negotiate with Couche-Tard Entrenched • Casey’s executives have been g
Slide 32: Coercive, entrenching financing shows Board must be replaced
Casey’s coercive, entrenching financing demonstrates that Casey’s Board must be replaced Casey’s leveraged recapitalization is a pretext for installing a coercive financing arrangement with a very costly “poison put” mechanism designed to impede ANY takeover attempt by ANY party • Casey’s executed a
Slide 33: Board misinforming shareholders about cost of coercive financing
Casey’s Board is misinforming shareholders about the true cost of its coercive financing • If enforceable, Casey’s “poison put” mechanism transfers substantial value from Casey’s shareholders to Casey’s noteholders – Makes it approximately $100 million more expensive to acquire Casey’s (based on cur
Slide 34: Couche-Tard financing favorable while Casey's is off-market
Couche-Tard obtained favorable financing while Casey’s financing is off-market • Couche-Tard’s financing proves that Casey's could have financed its self-tender much more cost effectively and avoided the coercive and expensive "poison put" it gave to its new lenders – Typically, debt financing used
Slide 35: Selected retail financings
Selected retail financings • Casey's new $569 million notes do not have publicly available ratings • Assuming a credit rating of BBB or strong BB (low investment grade or strong high yield), Casey's new notes issue appears to be off-market • Relative to investment grade notes issues, the yield is al
Slide 36: Responses to Casey's misinformation campaign
4. Responses to Casey’s misinformation campaign 32
Slide 37: Board misinforming shareholders about the offer
Casey’s Board is misinforming shareholders about Couche-Tard’s offer Casey’s claims that Couche-Tard’s offer substantially undervalues Casey’s and represents a low premium relative to precedent transactions Our offer is at a premium multiple and provides a unique opportunity for Casey’s shareholders
Slide 38: Board misinforming shareholders about the offer (cont'd)
Casey’s Board is misinforming shareholders about Couche-Tard’s offer (cont’d) Casey’s states in their presentations that they “expect the favorable gasoline environment to continue” – Why? They don’t say… Number of gasoline outlets and “hoses” has held steady or grown – Particularly true in the Midw
Slide 39: Board misinforming shareholders about the offer (cont'd)
Casey’s Board is misinforming shareholders about Couche-Tard’s offer (cont’d) Casey’s claims that Couche-Tard’s offer does not reflect recent sector performance - Casey’s is misinforming shareholders by comparing recent share price performance to that of Couche-Tard, Susser and The Pantry Casey’s is
Slide 40: Board misinforming shareholders about the offer (cont'd)
Casey’s Board is misinforming shareholders about Couche-Tard’s offer (cont’d) Casey’s claims that Couche-Tard’s offer is opportunistic and intends to take advantage of equity market volatility Casey’s had since October of 2009 to seek alternatives – No other firm offer to buy the company has appeare
Slide 41: Board misinforming shareholders about the offer (cont'd)
Casey’s Board is misinforming shareholders about Couche-Tard’s offer (cont’d) Casey’s claims Couche-Tard’s offer would adversely impact Casey’s other constituencies Couche-Tard’s offer is very attractive for ALL of Casey’s constituencies Couche-Tard’s track record with employees of companies and wit
Slide 42: Board misinforming shareholders about the offer (cont'd)
Casey’s Board is misinforming shareholders about Couche-Tard’s offer (cont’d) Casey’s claims its performance, growth opportunities, balance sheet and human capital can create far greater value for shareholders Casey’s leveraged recapitalization implies they do not have good opportunities to invest a
Slide 43: Next steps for shareholders
Next steps for shareholders Vote FOR Couche-Tard’s nominees and proposal on the BLUE proxy card • Elect the new slate of independent candidates for the Board of Directors, who are committed to maximizing value for all Casey’s shareholders • Vote FOR Couche-Tard’s proposal regarding new or amended By
Slide 44: Appendix
Couche-Tard Appendix 40
Slide 45: A. Couche-Tard Nominees and Biographies
A. Couche-Tard Nominees and Biographies 41
Slide 46: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details Howard W. Bates 56 Mr. Bates currently is self-employed as a business consultant and is actively engaged in raising capital for early stage growth and new venture start-ups. From 2007 to 2009, Mr. Bates served as Presiden
Slide 47: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details Hugh L. Cooley 60 Mr. Cooley retired from Shell Oil Products Company in July 2009. In 37 years with Shell Oil Products Company, Mr. Cooley held various positions, including, among others, Vice President of Marketing and S
Slide 48: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details Terrence Coriden 63 Since 1998, Mr. Coriden has served as an attorney for, and part owner of, Coriden, Coriden, Andrews & Glover, LLC (formerly Coriden Law Office, LLC). Mr. Coriden is also currently Of-Counsel for Dugan
Slide 49: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details Mickey Kim 51 As of 2005, Mr. Kim was the Chief Operating Officer and Chief Compliance Officer of Kirr, Marbach & Company, LLC, a registered investment adviser, and continues to currently hold such positions. Mr. Kim is a
Slide 50: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details David O. Mann 41 Since 2002, Mr. Mann has served as a partner of Spring Mill Venture Partners, LLC, a venture capital firm focused on early stage, high-growth life science and information technology investments. Previousl
Slide 51: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details Kevin J. Martin 44 Since 2001, Mr. Martin has served as the Chief Financial Officer of Johnson Ventures, Inc., a private investment company. Mr. Martin serves on the board of directors of the following organizations: JV P
Slide 52: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details David B. McKinney 55 Since 1998, Mr. McKinney has served as President and Chief Compliance Officer of Reams Asset Management Company, an investment management firm. From 2003 to 2005, Mr. McKinney served on the board of d
Slide 53: Independent Nominees – Biographical Information
Independent Nominees – Biographical Information Name Age Qualification details Marc E. Rothbart 47 Since 1999, Mr. Rothbart has served as Chief Financial Officer and Senior Vice President of SIHO Insurance Services, Inc., an employee health care benefits company. Mr. Rothbart serves on the board of
Slide 54: Who is Alimentation Couche-Tard?
Who is Alimentation Couche-Tard? 50
Slide 55: History of Couche-Tard
History of Couche-Tard 4th Public Offering Franchise agreement with Grupo Kaltex, S.A. Couche-Tard Entry into U.S. Midwest de C.V. for 250 stores in offers to acquire Alain Bouchard Started 225 Bigfoot Stores as part Mexico within the next Casey’s at $38.50 the Chain with one store of Johnson Oil Ac
Slide 56: Longstanding history of successful acquisitions and de-leveraging
Longstanding history of successful acquisitions and de-leveraging Recent acquisitions FYE April 2004 FYE April 2005 FYE April 2006 FYE April 2007 FYE April 2008 FYE April 2009 FYE April 2010 Total net debt / EBITDA 2.3x 1.4x 1.5x 1.3x 1.0x 0.8x 0.6x 0.4x At Circle K 2004 2005 2006 2007 2008 2009 201
Slide 57: Couche-Tard has a large presence in the U.S.
Couche-Tard has a large presence in the U.S. • 3,836 stores in the U.S. – 65% of total stores • Presence in 43 states and Washington D.C. • 8 out of 11 divisions in the U.S. • 36,000 employees out of 53,000 are in the U.S. – 68% of total • 78% of revenues come from U.S. divisions Couche-Tard Casey’s
Slide 58: The Strategic Rationale
Couche-Tard The Strategic Rationale Fe 54
Slide 59: Compelling strategic rationale
Compelling strategic rationale • Creates largest independent corporate-store operator in North America with ~ 7,400 locations • Expands geographic footprint across North America • Enhances scale and efficiency • Uniquely positions Couche-Tard to generate more cash flow • Delivers immediate premium t
Slide 60: Creates the largest independent corporate-store operator in North America
Creates the largest independent corporate-store operator in North America 8,100 7,400 1,468 5,869 1,468 (1) 4,639 (1) 7,100 4,144 (1) 3,984 5,932 4,596 3,367 4,401 3,601 1,815 1,649 1,598 1,531 (1) 428 1,305 900 884 1,387 1,649 1,598 1,531 527 1,302 498 1,000 777 900 43 383 386 527 3 7-Eleven Pro fo
Slide 61: Enhanced store network
Enhanced store network Casey’s retail footprint ND 37 MN 97 SD WI 104 10 IA NE 436 109 IL IN 377 65 Couche-Tard’s retail footprint MO CENTRAL CANADA 296 Corporate stores: 571 Total stores: 1,531 Affiliated stores: 199 WESTERN CANADA EASTERN CANADA Corporate stores: 287 Corporate stores: 676 Affiliat
Slide 62: Integration strategy
Integration strategy Couche-Tard expects that: • Couche-Tard’s decentralized business model will allow it to run Casey’s as a stand-alone business unit • No significant capital expenditures will be required to integrate Casey’s • Casey’s store banner will remain in place (no re-branding / remodels r
Slide 63: S&P Retail Index constituents
S&P Retail Index constituents ($ in billions) Market Capitalization Ticker Company Name as of Sep. 1, 2010 AZO AutoZone $10.2 BBBY Bed Bath & Beyond 9.8 BBY Best Buy 13.7 BIG Big Lots 2.6 COST Costco Wholesale 25.5 CVS CVS Caremark 37.9 DDS Dillard's 1.5 DG Dollar General 9.6 FDO Family Dollar Store