Sunoco LP Announces Private Offering of Senior Notes

Rhea-AI Summary

Sunoco LP (NYSE: SUN) announced a private offering of senior notes totaling $500 million, due in 2029. The funds will be used alongside cash on hand for a tender offer for its existing 4.875% senior notes maturing in 2023. The offering is aimed at qualified institutional buyers under Rule 144A and non-U.S. entities under Regulation S. Notably, the notes are not registered under the Securities Act, which limits their offering in the U.S.

Positive

• The offering of $500 million in senior notes may strengthen Sunoco's financial position.
• Proceeds are targeted for a tender offer of 4.875% senior notes due 2023, potentially improving the company's debt profile.

Negative

• The offering is not registered under the Securities Act, which could limit market accessibility.
• Market uncertainty due to ongoing risks related to the COVID-19 pandemic and declining commodity prices.

DALLAS, Nov. 9, 2020 /PRNewswire/ -- Sunoco LP (NYSE: SUN) ("Sunoco") today announced a private offering (the "offering") of senior notes due 2029 (the "notes") in an aggregate principal amount of $500 million. Sunoco Finance Corp., a wholly owned direct subsidiary of Sunoco, will serve as co-issuer of the notes.

Sunoco intends to use the net proceeds from the offering and cash on hand to fund the separately announced tender offer for a portion of its outstanding 4.875% senior notes due 2023 (the "2023 notes").

The offering of the notes has not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and, unless so registered, the notes may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. Sunoco plans to offer and sell the notes only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act and to non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act.

This news release is neither an offer to sell nor a solicitation of an offer to buy the notes or any other securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of, the notes or any other securities in any jurisdiction in which such offer, solicitation or sale is unlawful, nor does it constitute a notice of redemption under the optional redemption provisions of the indenture governing the 2023 notes.

About Sunoco LP

Sunoco LP (NYSE: SUN) is a master limited partnership with core operations that include the distribution of motor fuel to approximately 10,000 convenience stores, independent dealers, commercial customers and distributors located in more than 30 states as well as refined product transportation and terminalling assets. SUN's general partner is owned by Energy Transfer Operating, L.P., a wholly owned subsidiary of Energy Transfer LP (NYSE: ET).

Forward-Looking Statements

This news release may include certain statements concerning expectations for the future that are forward-looking statements as defined by federal law, including without limitation statements regarding the offering and the concurrent tender offer. Such forward-looking statements are subject to a variety of known and unknown risks, uncertainties, and other factors that are difficult to predict and many of which are beyond management's control. An extensive list of factors that can affect future results are discussed in Sunoco's Annual Report on Form 10-K and other documents filed from time to time with the Securities and Exchange Commission.  In addition to the risks and uncertainties previously disclosed, Sunoco has also been, or may in the future be, impacted by new or heightened risks related to the COVID-19 pandemic and the recent decline in commodity prices, and cannot predict the length and ultimate impact of those risks.  Sunoco undertakes no obligation to update or revise any forward-looking statement to reflect new information or events.

The information contained in this press release is available on our website at www.SunocoLP.com

Qualified Notice

This release is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat 100 percent of Sunoco LP's distributions to non-U.S. investors as being attributable to income that is effectively connected with a United States trade or business. Accordingly, Sunoco LP's distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate.

Contacts

Investors:

Scott Grischow, Vice President – Investor Relations and Treasury
(214) 840-5660, scott.grischow@sunoco.com

Derek Rabe, CFA, Manager – Investor Relations, Strategy and Growth
(214) 840-5553, derek.rabe@sunoco.com

Media:

Alexis Daniel, Manager – Communications
(214) 981-0739, alexis.daniel@sunoco.com

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SOURCE Sunoco LP

FAQ

What is the amount of the senior notes Sunoco is offering?

Sunoco is offering senior notes totaling $500 million.

What will the proceeds from the Sunoco offering be used for?

The proceeds will be used to fund a tender offer for a portion of its 4.875% senior notes due in 2023.

Which regulations govern the offering of Sunoco's senior notes?

The offering is conducted under Rule 144A for qualified institutional buyers and Regulation S for non-U.S. entities.

When do the senior notes Sunoco is offering mature?

The senior notes offered by Sunoco are due in 2029.