This month, New Zealand’s two largest chains of unmanned petrol stations will combine to form a dual-branded entity with some 240 locations and a nearly 20% market share. Sydney-based Allegro Funds, the architect of the merger, has formalized an agreement with its 50-50 co-owner to sell 100% of the enlarged business within its investment horizon.

When Allegro acquired 100% of Gull New Zealand for NZD 552m (USD 314m) in mid-2022, it was already the largest independent operator of its kind locally. Much of the plan revolved around repositioning a fossil fuel business for a more environmentally minded future. Electric vehicle (EV) charging and biofuels were high on the agenda and expected to benefit from government priorities.

Those government priorities changed. Household budgets tightened. And Gull’s foundational value proposition of being the cheapest fuel option for motorists came into sharper focus.

The company achieves savings by operating small, no-frills stations, sometimes in suboptimal locations. These have no staff and not so much as a vending machine. During Allegro’s holding period, even rubbish bins have been streamlined out.

“If you’ve got a structurally advantageous cost base in a transition sector, you should win. Costs are high for labour and rent, and they only go up at more than CPI [consumer price index] every year. Topline for our competitors is under pressure. They have to cancel highly profitable cigarette sales and sell fewer sugary goods,” said Fay Bou, a partner at Allegro, citing regulatory pressure on tobacco and junk food.

“As a result, you’re seeing all the majors in New Zealand – and also in Australia – having to find the next hotdog to sell just to keep up.”

As Gull has navigated this landscape on the country’s North Island, its closest counterpart, NPD, has delivered a similar proposition on South Island. Bou spearheaded negotiations for a merger in February 2025. The extended process involved 10 Allegro professionals. It is the largest transaction of its kind for the private equity firm, creating a company with an enterprise value of just over NZD 1bn.

Operational angles

Allegro’s key value creation contribution to Gull was in deploying several operating partners, who guided a management transition. For 16 years, the company had been led by CEO Dave Bodger, who effectively doubled as CFO. The staff was small, only 35 company-wide at acquisition, in the interest of keeping costs down. The challenge was to professionalise this set-up without spoiling its tight economics.

Key operating partners included Steve Bushaway, who initially acted as interim CFO, and Melita Swartz, who headed the human capital build-out. A replacement for Bodger, who had agreed to step down to a non-executive director role, was quickly identified in consumer goods veteran Dan Gilbert.

“I did a lot of research on private equity firms and found there are some good ones and some not-so good ones. Allegro had a good reputation around how they supported management and bought into businesses by being part of the team,” Gilbert said.

“I talked about how I wanted to invest in the brand and do things that hadn’t been done. They said, ‘Yep, that’s good. If you write a business case, we’ll back it.’ Three years later, we had quadrupled our marketing spend and put another 20% of headcount into the business. Private equity firms are usually pretty keen to cut those types of investments.”

During the holding period, the number of stations has ticked up from 115 to 125, as annual revenue increased from NZD 1bn to around NZD 1.3bn, and market share edged marginally above 8%. But the value creation plan was mostly about making Gull better, not bigger.

Perhaps most significantly, the marketing outlays included an advertising campaign that splashed comedy and colour into a bland industry, while promoting weekly special discounts via a newly launched app.

The app, which now represents about 20% of revenue, has helped speed up customer pitstops from about two minutes to under 90 seconds. This has in turn helped boost Gull’s standing in the Kantar Corporate Reputation Index, a widely followed domestic business monitor, where the company now ranks in the top 20 most trusted brands in New Zealand and number three in terms of fairness.

Reputational traction is largely attributed to micro adjustments at the customer-facing level. To improve sourcing efficiency and pricing, the product offering has been trimmed to three fuels: regular and premium unleaded and diesel. A more expensive biofuel has been dropped. This month, a revamp of station livery dubbed Gull 2.0 is being rolled out.

Unmanned remains the mantra. Even the janitors who dust the pumps are outsourced. The overall staff, primarily in the head office, has crept up to only about 45. Salaries were increased and all were given access to shares in the company.

“Having a small team has meant that what we’ve achieved in three years is quite frankly phenomenal. It’s because we’re small and nimble enough to get stuff done but also because Allegro don’t pontificate. If you need a decision made, they will literally make it that week for you,” Gilbert said.

Gull is notable for being one of only two independent petrol station operators in New Zealand with its own fuel import terminal, including six bulk storage tanks and a 1.5km pipeline. This bolstered security of supply during the fuel shortages in 1H26, according to Gilbert. The company held twice-daily crisis meetings for at least a month, with Bou dialling in as appropriate.

Business sense

While the biggest ambitions for going green have been curtailed, value creation work has not been without significant progress on the environmental, safety, and governance (ESG) front. The import terminal, for example, was outfitted with a vapor recovery unit in March last year. It converts petrol vapours into saleable fuels.

More prominently, the EV programme has not been abandoned. Charging facilities have been introduced at several stations through a joint venture with ChargeNet, the largest domestic rapid charging network. These are not profitable installations but seen as valuable for testing and learning with a view to being market-ready when the electrification trend hits critical mass locally.

Only 2.2% of vehicles in New Zealand are pure EVs, according to EVDB and the New Zealand Automotive Association, but the trajectory is clear. EVs have 13.3% market share in New Zealand in terms of new light vehicle registrations in 2026 to date. That figure is projected to be 23.1% by 2030.

“We know the market’s going to change. That’s our toes in,” Bou said, referring to the smattering of EV charging sites. “We can absolutely lean into the E [in ESG] to make sure we’re doing important transition work. But at the same time, it’s got to make business sense.”

Business sense in the Gull plan is all about leaning into inherent strengths while demonstrating growth and adding capabilities that resonate with potential buyers – all in recognition that the petrol industry is transitioning. Most fundamentally, that means understanding that gassing up is not shopping; it’s a grudge purchase. Everything must be geared toward making it as painless as possible.

Alignment on this point was critical to the merger. As part of the deal, NPD agreed to offload several of its shops to local convenience store operator Night ‘n Day. The combined company, called NPDGull, will have an almost entirely unmanned nationwide footprint.

Agreement on the business model came early between Bou and Barry Sheridan, NPD’s CEO and 100% owner. The harder aspects of the merger were in winning Commerce Commission approval – which found no antitrust threats – and the cultural nuances of combining a corporatised, private equity-owned business with a patriarch-led family business.

“NPD has operated in New Zealand for over 55 years on a simple principle: give the motorist a fair price and earn their loyalty through consistency and trust. When we looked at who we wanted to build the next chapter with, we needed a partner who understood that model deeply and had the capability to help us scale without losing what makes it work,” Sheridan said.

“Allegro brings hands-on operational expertise, a genuine appetite for transformation, and the conviction to back a long-term play in a sector that will remain strategically critical through the energy transition and beyond. We are building NPDGull to be the enduring independent challenger in the New Zealand fuel market – and we are doing it with a partner whose interests are fully aligned with ours.”

Fond farewell

NPDGull will maintain the Gull and NPD brands separately. It will have the scale to purchase 1bn litres of fuel a year, which is expected to strengthen its negotiating stance with suppliers. Annual EBITDA will amount to about NZD 150m, according to Bou. Gull had about NZD 90m in annual EBITDA at the time of acquisition.

The extended timeframe of the transaction process has afforded time to prepare for post-merger growth plans. This could include the eventual acquisition of a second import terminal, ideally on South Island. Allegro’s operating partners will continue to support the business where needed.

Sheridan has committed to staying on as CEO and 50% owner of NPDGull. Once again, Allegro’s Bushaway will step in as interim CFO, with Gilbert remaining in an advisory role for nine months. “It’s a nice time to do something else, but I wouldn’t be surprised if I was back in the camp with Allegro at some point in time,” he observed.

At the time of interview, Bou, who is Sydney-based, was in New Zealand as part of the lead-up to the inauguration of NPDGull ­­– but also to attend Gilbert’s farewell.

“They know how to respect people, and people see that. They have a great rapport with the team,” Gilbert said. “It just means that when it gets tough – and there were challenging times – everyone pulls together. They don’t pull apart, and we get the result. That’s why culture is so important, and that’s why it’s been important for Allegro to invest in people.”