DALLAS, April 6, 2017 /PRNewswire/ -- Sunoco LP (NYSE:
SUN) ("SUN") today announced that it entered into a definitive
asset purchase agreement for the sale of a majority of its
convenience stores to 7-Eleven, Inc. ("7-Eleven").
Total consideration in the transaction is $3.3 billion in cash plus fuel, merchandise and
other inventories. SUN expects to use the proceeds to repay
indebtedness and for general partnership purposes.
SUN President and Chief Executive Officer Bob Owens stated, "The sale of these retail
assets to 7-Eleven is the beginning of an exciting evolution for
SUN into a premier nationwide fuel supplier. Our supply
agreement with 7-Eleven provides SUN with a predictable long-term
income stream, and this transaction quickly allows SUN to improve
its financial profile."
Assets being sold to 7-Eleven include approximately 1,110
convenience stores in 19 geographic regions primarily along the
East Coast and in Texas, and the
associated trademarks and intellectual property of the Laredo Taco
Company and Stripes. As part of the transaction, SUN will
enter into a 15-year take-or-pay fuel supply agreement with a
7-Eleven subsidiary under which SUN will supply approximately 2.2
billion gallons of fuel annually. This supply agreement will
have guaranteed annual payments to SUN, provides that 7-Eleven will
continue to use the Sunoco brand at currently branded Sunoco stores
and includes committed growth in future periods.
Approximately 200 convenience stores in North and West Texas, New
Mexico and Oklahoma will be
sold in a separate process. SUN's Aloha Petroleum business
unit in Hawaii will continue to
operate its highly efficient and integrated business model within
SUN. Likewise, the transaction does not include SUN's highly
successful APlus franchisee-operated stores.
SUN's transaction with 7-Eleven is the first step in SUN's
strategic shift away from company-operated convenience stores to
focus on its industry-leading fuel supply business. Led by
the iconic Sunoco fuel brand and successful APlus franchise, SUN
plans to be a leading consolidator in the domestic wholesale fuels
business, supplying fuel to a network of more than 8,900 locations
of third-party dealers, distributors and other commercial
customers, with an enhanced focus on MLP qualifying income.
Additionally, the proceeds received in this transaction will be
used to further enhance SUN's credit profile and leverage
profile.
This transaction is subject to regulatory clearances and
customary closing conditions and is expected to close by the fourth
quarter 2017.
J.P. Morgan Securities LLC ("JP Morgan") served as SUN's
exclusive financial advisor for the transaction. In addition,
SUN has retained JP Morgan to market the approximately 200
remaining convenience stores in North and West Texas, New
Mexico and Oklahoma.
Conference Call
Sunoco LP management will hold a conference call
on Thursday, April 6, at 8:00 a.m. CT (9:00 a.m. ET) to discuss the transaction.
To participate, dial 201-389-0877 approximately 10 minutes early
and ask for the Sunoco LP conference call.
About Sunoco LP
Sunoco LP (NYSE: SUN) is a master limited partnership that
operates 1,345 convenience stores and retail fuel sites and
distributes motor fuel to 7,845 convenience stores, independent
dealers, commercial customers and distributors located in 30
states. Our parent -- Energy Transfer Equity, L.P. (NYSE: ETE) --
owns SUN's general partner and incentive distribution rights.
Cautionary Statement Relevant to Forward-Looking
Information
This press release includes forward-looking statements regarding
future events. These forward-looking statements are based on SUN's
current plans and expectations and involve a numbers of risks and
uncertainties that could cause actual results and events to vary
materially from the results and events anticipated or implied by
such forward-looking statements. For a further discussion of these
risks and uncertainties, please refer to the "Risk Factors" section
of SUN's most recently filed annual report on Form 10-K and in
other filings made by SUN with the Securities and Exchange
Commission. While Sunoco may elect to update these
forward-looking statements at some point in the future, it
specifically disclaims any obligation to do so, even if new
information becomes available.
Contacts
Investors:
Scott Grischow
Senior Director – Investor Relations and Treasury
(214) 840-5660, scott.grischow@sunoco.com
Patrick Graham
Senior Analyst – Investor Relations and Finance
(214) 840-5678, patrick.graham@sunoco.com
Media:
Alyson Gomez
Director – Communications
(469) 646-1758, alyson.gomez@sunoco.com
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SOURCE Sunoco LP