Sunoco (SUN) To Exit Refining, Conduct Strategic Review
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Sunoco, Inc. (NYSE: SUN) announced plans to exit its refining business and is also conducting a comprehensive strategic review of the company to determine the best way to deliver value to shareholders, including how best to utilize the company's strong cash position and maximize the potential for Sunoco's logistics and retail businesses.
The company has begun a process to sell its refineries located in Philadelphia and Marcus Hook, Penn..
Credit Suisse Securities (USA) LLC has been retained to assist in the review process.
Sunoco will pursue all options to sell its refineries, but if a suitable transaction cannot be implemented, the company intends to idle the main processing units at the facilities in July 2012.
In connection with the decision to exit refining, the company expects to record a pretax noncash charge of between $1.9 billion and $2.2 billion in the third quarter of 2011 related to impairment of the plant and equipment in the refineries. In the event the processing units are idled, additional pretax charges of up to $500 million, primarily related to contract terminations, staffing costs and severance, may be incurred.
Sunoco also announced that it has substantially completed the $500 million share repurchase program that was announced on August 9, 2011.
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The company has begun a process to sell its refineries located in Philadelphia and Marcus Hook, Penn..
Credit Suisse Securities (USA) LLC has been retained to assist in the review process.
Sunoco will pursue all options to sell its refineries, but if a suitable transaction cannot be implemented, the company intends to idle the main processing units at the facilities in July 2012.
In connection with the decision to exit refining, the company expects to record a pretax noncash charge of between $1.9 billion and $2.2 billion in the third quarter of 2011 related to impairment of the plant and equipment in the refineries. In the event the processing units are idled, additional pretax charges of up to $500 million, primarily related to contract terminations, staffing costs and severance, may be incurred.
Sunoco also announced that it has substantially completed the $500 million share repurchase program that was announced on August 9, 2011.
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