Sunoco LP launches $1 billion preferred equity offering

Sunoco LP (NYSE: SUN) announced a private offering of 1,000,000 Series A Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Units, according to a company statement.

The company plans to use proceeds from this offering alongside a concurrent $1.7 billion senior notes offering to fund its acquisition of Parkland Corporation and related transaction costs. Prior to the acquisition closing, Sunoco will use the funds to reduce borrowings under its revolving credit facility.

The preferred units include a special mandatory redemption provision if the Parkland acquisition is not completed by May 5, 2026, or if the arrangement agreement is terminated before that date. Under these circumstances, the units would be redeemed at $1,000 per unit plus accumulated unpaid distributions.

The offering is structured as a private placement to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S. The securities have not been registered under the Securities Act of 1933.

This preferred equity offering operates independently of both the Parkland acquisition and the concurrent notes offering, with none of the transactions contingent on completion of the others.

Sunoco operates energy infrastructure and fuel distribution across more than 40 U.S. states, Puerto Rico, Europe, and Mexico, with approximately 14,000 miles of pipeline and over 100 terminals. The company's general partner is owned by Energy Transfer LP (NYSE: ET).

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