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Energy Transfer Partners Plans to Acquire Sunoco for $5.3 Billion to Enter into Lucrative Oil Transportation Business - Deal Analysis from GlobalData

Energy Transfer Partners Plans to Acquire Sunoco for $5.3 Billion to Enter into Lucrative Oil Transportation Business - Deal Analysis from GlobalData

Table of Contents

Market Briefing
Published: May 2012
Pages: 9
Tables: For full details, please email deborahf@cmsinfo.com
From: GBP 312.50  Buy Now!
Research from: GlobalData
Sector: Oil & Gas

Energy Transfer Partners Plans to Acquire Sunoco for $5.3 Billion to Enter into Lucrative Oil Transportation Business - Deal Analysis from GlobalData

Summary

Energy Transfer Partners L.P (ETP) agreed to acquire Sunoco Inc (Sunoco) for a purchase consideration of approximately $5.3 billion. As a part of the consideration, Sunoco shareholders can elect to receive, for each common share, either $50 in cash, 1.0490 ETP common units or a combination of $25 in cash and 0.5245 ETP common units.

In connection with the transaction, ETP will also own Sunoco?s general partner interest and the Incentive Distribution Rights (IDRs) in Sunoco Logistics Partners, and Sunoco?s 32.4% interest in Sunoco Logistics Partners? limited partner units and Sunoco?s branded retail business, which generates stable cash flows from a portfolio of approximately 4,900 retail outlets in the US.

Upon completion of the transaction, Sunoco shareholders are expected to own approximately 20% of ETP common units. The acquisition will enable ETP to expand its geographical footprint and strengthen its presence in the transportation, terminalling and logistics of crude oil, NGLs and refined products.

Wells Fargo Securities, LLC is acting as financial advisor, while Latham & Watkins LLP, Bingham McCutchen LLP and Morris, Nichols, Arsht & Tunnell LLP are acting as legal advisors to Energy Transfer Partners in the transaction. Credit Suisse Securities (USA) LLC is acting as financial advisor, while Wachtell, Lipton, Rosen & Katz is acting as legal advisor to Sunoco in the transaction.

The transaction is expected to be closed in the third or fourth quarter of 2012, subject to approval by both the companies' board of directors, shareholders and other customary regulatory approvals.

Scope

- Rationale behind ETP to acquire Sunoco
- Stratigic benefits for the companies involved in the transaction
- Geography covered - US

Reasons to buy

- Develop a sound understanding of the major M&A's, Partnerships, and Joint Ventures undertaken by ConocoPhillips. Rationale behind ConocoPhillips selling Nigerian assets.
- ConocoPhillips's plan to globally restructure its business.
- Identify the reason behind ConocoPhillips selling its Nigerian assets.

Keywords

ETP, Sunoco, pipelines, US East Coast, Northeastern States,Tax, Master Limited Partnership (MLP)

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