Sunoco LP has closed the strategic divestiture of most of its company-operated convenience stores to 7-Eleven Inc., which acquired approximately 1,030 of Sunoco’s c-stores in 17 states for approximately $3.114 billion.
Dallas-based Sunoco’s strategic divestiture is a major step in transforming it into a more stable-income master limited partnership (MLP) focused on fuel distribution and logistics rather than retailing, the company said.
On the retail side, however, the transaction does not include Sunoco’s APlus franchisee-operated c-stores, and Sunoco’s Aloha Petroleum business unit in Hawaii will continue to operate its integrated business model within Sunoco
The transaction with 7-Eleven Inc., announced April 6, 2017, includes a 15-year take-or-pay fuel-supply agreement under which Sunoco will supply about 2 billion gallons of fuel annually with an additional 500 million gallons of committed growth in the future
Sunoco will use the gross proceeds from the transaction to achieve targeted leverage and coverage goals, it said.
Meanwhile, Sunoco's strategic conversion of 207 West Texas retail sites to a commission agent model remains on schedule with a conversion date expected to occur late in first-quarter 2018
Sunoco also announced the closing of a private offering of $2.2 billion of various senior notes due 2023, 2026 and 2028.
Sunoco distributes motor fuel to about 9,200 convenience stores, independent dealers, commercial customers and distributors in more than 30 states. Its general partner is owned by Energy Transfer Equity LP
For Irving, Texas-based 7-Eleven, this acquisition is the largest in the company’s history, and will bring its total store count to about 9,700 in the United States and Canada. Seven & i Holdings Co. Ltd., the Tokyo-based parent company of 7-Eleven Inc., operates more than 65,000 stores in 18 countries globally.