Sunoco LP to Purchase Refined Product Terminals from NuStar Energy L.P. and Cato, Incorporated

Rhea-AI Summary

Sunoco LP (NYSE: SUN) has announced its acquisition of nine refined product terminals for a total of $255.5 million. The acquisitions include terminals from NuStar Energy L.P. and Cato, Incorporated, significantly expanding SUN's midstream operations. This strategic move enhances SUN's fuel distribution capabilities while maintaining its financial leverage targets. The deal is expected to be accretive to unitholders upon closing in Q4 2021. The acquired terminals, primarily located on the East Coast and in the Midwest, have a combined storage capacity of approximately 14.8 million barrels.

Positive

• Acquisition of nine terminals enhances SUN's midstream business and fuel distribution capabilities.
• Expected to be immediately accretive to unitholders.
• Maintains long-term leverage and coverage target levels.

Negative

• Acquisition is subject to customary closing conditions which may delay benefits.
• Potential risks associated with COVID-19 pandemic and commodity price declines.

DALLAS, Aug. 2, 2021 /PRNewswire/ -- Sunoco LP (NYSE: SUN) ("SUN" or the "Partnership") announced the execution of definitive agreements to acquire eight refined product terminals from NuStar Energy L.P. ("NuStar") and one refined product terminal from Cato, Incorporated ("Cato") for a combined purchase price of $255.5 million.                         

These acquisitions will result in a significant expansion of SUN's midstream business, enhance its platform for fuel distribution expansion and allow SUN to remain within its long-term leverage and coverage target levels.  SUN will continue to employ a disciplined approach toward future acquisitions.

NuStar Acquisition
The NuStar acquisition includes seven refined product terminals on the East Coast and one in the Midwest in the following locations: Andrews Air Force Base, MD; Baltimore, MD; Blue Island, IL; Jacksonville, FL; Linden, NJ; Paulsboro, NJ; Piney Point, MD; and Virginia Beach, VA. The terminals have an aggregate storage capacity of approximately 14.8 million barrels, handle primarily refined products and are accessed via pipeline, truck, rail, and marine vessels.

Cato Acquisition
The Cato terminal is a gasoline and distillate terminal located in Salisbury, MD with approximately 140 thousand barrels of storage and is accessed via truck and marine vessels. As part of the transaction, Cato has agreed to a five-year extension of its existing SUN fuel distribution contract.

Both acquisitions are expected to close in the fourth quarter of 2021, subject to the satisfaction of customary closing conditions. The Partnership expects the acquisitions to be immediately accretive to unitholders. 

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 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. 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 the Partnership'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, the Partnership 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 we cannot predict the length and ultimate impact of those risks.  The Partnership 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

James Heckler, Director – Investor Relations and Corporate Finance
(214) 840-5415, james.heckler@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 total purchase price for Sunoco's recent acquisitions?

The total purchase price for the acquisitions is $255.5 million.

How many terminals is Sunoco acquiring from NuStar and Cato?

Sunoco is acquiring eight terminals from NuStar and one terminal from Cato.

When is the expected closure date for Sunoco's acquisitions?

The acquisitions are expected to close in the fourth quarter of 2021.

What is the total storage capacity of the acquired terminals?

The acquired terminals have a combined storage capacity of approximately 14.8 million barrels.

How will these acquisitions affect Sunoco's unitholders?

The acquisitions are expected to be immediately accretive to unitholders.