Applegreen drops out of $750 million service plaza deal

Applegreen on Tuesday dropped out of a deal with the Massachusetts Department of Transportation to redevelop 18 highway service plazas in the state. The Irish retailer announced its decision a day after Waltham-based Global Partners, which currently operates the plazas, requested a court order to block the state’s deal with Applegreen.

The news is the latest development in a business dispute dating back to June, after MassDOT awarded to Applegreen a 35-year lease to rebuild and operate the service plazas. Global Partners claimed that its competing proposal would have netted the state $1.5 billion more revenue and alleged there were “illicit communications” and undisclosed conflicts of interest between MassDOT officials and Applegreen. Both Applegreen and MassDOT denied any wrongdoing.

Global Partners in August filed a lawsuit in Suffolk Superior Court to compel the release of communications related to the contract. On Sept. 15 Global Partners asked a Suffolk Superior Court judge for a temporary restraining order and a preliminary injunction to block MassDOT from executing its lease with Applegreen.

“After three months of good faith negotiations, Applegreen and MassDOT have not reached agreement on definitive terms for the redevelopment of 18 motorway service areas in Massachusetts,” Applegreen said in a statement released Tuesday. “The open issues have significant implications for the commercial viability of the concession award. These commercial realities have been coupled with costly and continued litigation threats from an opposing bidder that have jeopardized the project’s timeline and financing. In light of these circumstances, Applegreen has terminated ongoing lease discussions.”