Sunoco’s expansion continues with the acquisition of Susser Holdings Corp.
Sunoco LP has completed the acquisition of Susser Holdings Corp. (SHC). The corporation was acquired from ETP Holdco Corp. and Heritage Holdings Inc., wholly-owned subsidiaries of Energy Transfer Partners LP (ETP).
The transaction is valued at approximately $1.93 billion. Sunoco paid $966.9 million in cash and issued ETP’s subsidiaries approximately 21.98 million Sunoco units, valued at approximately $966.9 million. In addition, there will be an exchange for 11 million Sunoco units owned by SHC for another 11 million new Sunoco units to a subsidiary of ETP.
The transaction is expected to be slightly accretive to Sunoco with respect to distributable cash flow in 2015 and significantly accretive thereafter.
SHC’s assets consist primarily of approximately 680 Stripes branded convenience stores that sell motor fuel and merchandise in Texas, Oklahoma and New Mexico. Stripes is the leading independent operator of convenience stores in Texas based on store count and retail motor fuel volumes sold. The majority of the Stripes locations include food service, primarily through its proprietary Laredo Taco Co. concept, which serves fresh, hot, made-to-order Mexican food.
For Sunoco, the addition of significant size and scale will deliver new organic growth opportunities and enhance its ability to focus on a broad range of third-party acquisition opportunities. The dynamic EBITDA growth at SHC creates a strong runway for increasing distributable cash flow beginning in 2016.
Management expects that all income from SHC’s operations will be considered non-qualifying for tax purposes to Sunoco and as such SHC will be owned by Sunoco’s indirect wholly owned subsidiary, Susser Petroleum Property Company, LLC (“PropCo”). Sunoco anticipates that cash taxes at PropCo going forward will be minimal.
