Sunoco LP to Acquire NuStar Energy L.P. in Transaction Valued at $7.3 Billion

Source: www.gulfoilandgas.com 1/22/2024, Location: North America

Sunoco LP and NuStar Energy L.P. announced that the parties have entered into a definitive agreement whereby Sunoco will acquire NuStar in an all-equity transaction valued at approximately $7.3 billion, including assumed debt.

Transaction Details
- Under the terms of the agreement, NuStar common unitholders will receive 0.400 Sunoco common units for each NuStar common unit, implying a 24% premium based on the 30-day VWAP’s of both NuStar and Sunoco as of January 19, 2024. Sunoco has secured a $1.6 billion 364-day bridge term loan to refinance NuStar’s Series A, B and C Preferred Units, Subordinated Notes, Revolving Credit Facility, and Receivables Financing Agreement.

- The transaction has been unanimously approved by the board of directors of both companies and is expected to close in the second quarter of 2024 upon the satisfaction of closing conditions, including approval by NuStar’s unitholders and customary regulatory approvals.1

Strategic Rationale
- Increases Stability: Diversifies business, adds scale, and captures benefits of vertical integration by combining two stable businesses
- Strengthens Financial Foundation: Continues Sunoco’s successful capital allocation strategy on a larger scale, improving the Partnership’s credit profile, and supporting a growing distribution
- Enhances Growth: More cash flow generation for reinvestment and growth across an expanded opportunity set

Positive Financial Outlook
- Accretion: Immediately accretive with 10%+ accretion to distributable cash flow per LP unit by the third year following close
- Synergies: At least $150 million of run-rate synergies by the third year following close
- Financial Savings: Approximately $50 million per year of additional cash flow from refinancing high-cost floating rate capital
- Leverage: Will achieve leverage target of 4.0x within 12-18 months post close
- Distribution Growth: Supports continued distribution growth while maintaining strong coverage

1 Prior to closing, NuStar will make a cash distribution of $0.212 per common unit to its common unitholders.

Additional details will be made available today in a presentation on the Investor Relations section of Sunoco’s website at www.SunocoLP.com under Webcasts and Presentations and on the Investor section of NuStar’s website at www.NuStarEnergy.com.


Denmark >>  7/12/2024 - KKR, a leading global investment firm, and Palm Capital, the pan-European real estate private equity specialist announced the acquisition of a prime l...
United States >>  7/12/2024 - Bowman Consulting Group Ltd. (the “Company” or “Bowman”), a national engineering services firm delivering infrastructure design solutions to customers...

Norway >>  7/11/2024 - As of Thursday 11 July, French infrastructure group Vinci is the owner of all shares in Helios Nordic Energy. The full upfront payment of EUR 73 milli...
United States >>  7/11/2024 - Energy Services of America Corporation (the "Company" or "Energy Services") announced Nitro Construction Services, a subsidiary of Energy Services, ha...

United States >>  7/11/2024 - Martin Resource Management Corporation (“MRMC”), owner of the general partner of Martin Midstream Partners L.P. (NASDAQ:MMLP) (“MMLP”), announces that...
United States >>  7/11/2024 - H.I.G. Capital (“H.I.G.”), a leading global alternative investment firm with $64 billion of capital under management, is pleased to announce that one ...




Gulf Oil and Gas
Copyright © 2023 ICT All rights reserved. - Terms of Service - Privacy Policy.