Sunoco LP Announces Upsizing and Pricing of Private Offering of Senior Notes

Rhea-AI Summary

Sunoco LP (NYSE: SUN) has successfully priced an upsized private offering of $800 million in 4.500% senior notes due 2029. The offering will close on November 24, 2020, pending standard conditions. Sunoco aims to utilize the net proceeds, alongside borrowings from its revolving credit facility, to fund a tender offer for its existing 4.875% senior notes due 2023, with potential partial redemption included. The notes will be offered to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S, remaining unregistered under the Securities Act.

Positive

• Proceeds of $800 million from the senior notes will fund a tender offer, potentially enhancing liquidity.
• The offering indicates strong investor interest, priced at par.

Negative

• Issuing new senior notes could lead to shareholder dilution if additional financing is required in the future.
• Market conditions indicate potential risks due to the impact of COVID-19 and commodity price fluctuations.

DALLAS, Nov. 9, 2020 /PRNewswire/ -- Sunoco LP (NYSE: SUN) ("Sunoco") today announced that it has priced at 100% an upsized private offering (the "offering") of $800 million in aggregate principal amount of 4.500% senior notes due 2029 (the "notes"). Sunoco Finance Corp., a wholly owned direct subsidiary of Sunoco, will serve as co-issuer of the notes. The sale of the notes is expected to settle on November 24, 2020, subject to the satisfaction of customary closing conditions.

Sunoco intends to use the net proceeds from the offering and borrowings under its revolving credit facility to fund the separately announced tender offer for any and all of its outstanding 4.875% senior notes due 2023 (the "2023 notes") and, if applicable, a partial redemption of 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 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 tender offer and the concurrent debt financing. 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

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 purpose of Sunoco's recent $800 million senior notes offering?

The funds will be used for a tender offer for existing 4.875% senior notes due 2023 and possibly redeem part of those notes.

When will Sunoco's offering of senior notes close?

The offering is expected to close on November 24, 2020.

What are the terms of Sunoco's newly issued senior notes?

The new senior notes carry a 4.500% interest rate and are due in 2029.

Who can purchase the senior notes issued by Sunoco?

The notes will be sold to qualified institutional buyers and non-U.S. persons outside the United States.

Are Sunoco's senior notes registered under the Securities Act?

No, the notes have not been registered under the Securities Act and are offered under specific exemptions.