Sunoco Plans to Sell Refineries in Pennsylvania due to Dependence on Costly Feed Inputs and Falling Market Demand – Deal Analysis From GlobalData

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Sunoco Plans to Sell Refineries in Pennsylvania due to Dependence on Costly Feed Inputs and Falling Market Demand – Deal Analysis From GlobalData Powered By Docstoc
					                Sunoco Plans to Sell Refineries in Pennsylvania due to
                Dependence on Costly Feed Inputs and Falling Market
                     Demand – Deal Analysis From GlobalData
      Reference Code: GDGE0369M&A                                                                                                                      Publication Date: April 2012


      1         Table of Contents
      1 Table of Contents.................................................................1              1.1      List of Tables
       1.1 List of Tables .................................................................1
                                                                                                         Table 1:     The US East Coast, Refineries Closed/ Planned to
       1.2 List of Figures ................................................................1
                                                                                                                      be Closed, 2011 - April 2012 .................................... 2
      2 Sunoco Plans to Sell Refineries in Pennsylvania .................2
       2.1 Deal Overview ...............................................................2                Table 2:     Sunoco, Major Deals, 2009 - Present ...................... 5
       2.2 Deal in Brief ...................................................................2            Table 3:     Companies Involved................................................. 6
                                                                                                         Table 4:     Target Information .................................................... 6
       2.3 Difficult Environment for Refining Business has been
                                                                                                         Table 5:     Vendor Information................................................... 6
            Affecting the Overall Profitability of Sunoco ..................3
       2.4 Deal Financials and Valuations .....................................6
      3 Appendix ..............................................................................7
       3.1 Methodology ..................................................................7               1.2      List of Figures
       3.2 Contact Us.....................................................................8              Figure 1: Comparison of WTI and Brent Prices (Average) ,
       3.3 Disclaimer......................................................................8                                  st                     st
                                                                                                                   $/barrel, 1 Quarter 2010 - 1 Quarter 2012 ............ 3
                                                                                                         Figure 2: The US East Coast, Finished Refined Products
                                                                                                                                                                   st
                                                                                                                   Supplied, thousand barrels (Mbbls), 1 Quarter 2009
                                                                                                                      th
                                                                                                                   - 4 Quarter 2011 ..................................................... 3
                                                                                                         Figure 3: Sunoco, Contribution of Various Business Segments
                                                                                                                   to Total Operating Profit, $m, 2010 - 2011 .............. 3
                                                                                                         Figure 4: The US, Philadelphia, Location of Philadelphia
                                                                                                                   Refinery in the Map, 2012 ........................................ 4
                                                                                                         Figure 5: The US, Philadelphia, Location of Marcus Hook
                                                                                                                   Refinery in the Map, 2012 ........................................ 4




                                                                                                                                               GDGE0369M&A / Published APR 2012
Sunoco Plans to Sell Refineries in Pennsylvania due to                                                                                                                           Page 1
Dependence on Costly Feed Inputs and Falling Market Demand                                         © GlobalData. This report is a licensed product and is not to be copied, reproduced,
                                                                                                                                                           shared or resold in any form
      2      Sunoco Plans to Sell Refineries in                               The table presented below shows the closed refineries in the
             Pennsylvania                                                     US east coast region between 2011 and April 2012.

      2.1    Deal Overview                                                     Table 1:       The US East Coast, Refineries Closed/
                                                                                              Planned to be Closed, 2011 - April 2012
      Deal Type:                  Asset Transactions
                                                                                                                                              Refining
                                                                               Refinery
      Deal Status:                Planned                                      Name
                                                                                                   Operator             Status                Capacity
                                                                                                                                              (MMtpa)
      Announced Date:             September 06, 2011
                                                                               Marcus Hook                              Inactive     since
                                                                                                   Sunoco, Inc                                    8.86
                                                                               Refinery                                 Dec 2011
				
DOCUMENT INFO
Description: Sunoco, Inc., a manufacturer and marketer of petroleum and petrochemical products, intends to sell its Philadelphia and Marcus Hook, Pennsylvania refineries. The refineries have a combined crude oil processing capacity of 25.54 million tons per annum. The transaction will mark a fundamental shift away from manufacturing and re-position the company in the industry. Lynn L. Elsenhans, chairman and chief executive officer of Sunoco, said, "We have made progress in increasing the efficiency of our refineries over the last several years, but given the unacceptable financial performance of these assets, it is clear that it is in the best interests of shareholders to exit this business and focus on our profitable retail and logistics businesses which have higher returns, growth potential, and provide steady cash flow."
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GlobalData is an industry analysis specialist, providing business information products and services. GlobalData’s highly qualified team of analysts, researchers, and solution consultants use proprietary data sources, tools and techniques to gather, analyze and represent the latest and the most reliable information essential for a business to sustain a competitive edge. GlobalData is a UK-based company with presence across North America, Europe and Asia Pacific and has a broad product offering that ranges from interactive databases, reports and custom solutions. It is a comprehensive source of insights and analysis with coverage across the oil & gas, power, alternative energy, nuclear power, petrochemicals, medical equipment and healthcare industries. GlobalData has a broad range of coverage over key market segments. It has a global scope, covering a wide range of countries constituting more than 90% of global revenues in each of the industries it covers. With a large dedicated research and analysis capability, GlobalData employs rigorous primary and secondary research techniques in developing unique data sets and research materials. Its status as an independent research company allows Analysts to conduct trade interviews with key industry players. Access to unique databases of in-house market information further strengthens research and analysis capabilities. Materials are reviewed shaped by an expert panel of leading industry figures and representatives from key players in the relevant industries. Sectors and Geographies Covered GlobalData has a broad range of coverage over key market segments. It has a global scope, covering a wide range of countries constituting more than 90% of global revenues in each of the industries it covers. Research Methodology With a large dedicated research and analysis capability, GlobalData employs rigorous primary and secondary research techniques in developing unique data sets and research materials. Its status as an independent research company allows Analysts to conduct trade interviews with key industry players. Access to unique databases of in-house market information further strengthens research and analysis capabilities. Materials are reviewed shaped by an expert panel of leading industry figures and representatives from key players in the relevant industries.