One of Sunoco LP’s (SUN) wholly-owned subsidiaries is acquiring a wholesale motor fuel distribution business that services the Northeastern U.S.
The transaction is expected to cost SUN approximately $57 million plus the value of inventory on hand at the time of closing.
The business distributes approximately 55 million gallons a year of branded and unbranded gasolines, including Sunoco-branded fuels. As part of the transaction, SUN’s subsidiary will also acquire 30 fee-and-leased properties—including company-owned, dealer-operated and consignment sites—as well as supply contracts with dealer-owned and operated sites.
The purchase will complement SUN’s existing wholesale fuel distribution business in the Northeastern U.S. SUN plans to integrate the new business quickly and efficiently into its extensive fuel distribution network currently serving 30 states. The transaction is expected to be immediately accretive to SUN with respect to distributable cash flow.
The transaction is expected to close in the fourth quarter, subject to customary closing conditions, and will be funded using amounts available under SUN’s revolving credit facility.
Sunoco LP is a master limited partnership that operates more than 830 convenience stores and retail fuel sites and also distributes motor fuel to convenience stores, independent dealers, commercial customers and distributors.