Sunoco removes cap in tender offer for 4 7/8% notes due 2023

By Taylor Fox

New York, Nov. 9 – Sunoco LP removed the cap in its cash tender offer to purchase its $1 billion outstanding 4 7/8% senior notes due 2023 (Cusips: 86765LAH0, U86759AE4 and 86765LAJ6), according to a news release Monday evening.

The company announced the offer earlier on Monday with an initial cap of $500 million.

Sunoco plans to fund the tender offer, including interest, fees and expenses, with the proceeds of $800 million of 4½% debt securities priced Monday, together with cash on hand. The offering was upsized from an initial size of $500 million.

Holders who validly tender their notes prior to the 5 p.m. ET on Nov. 23 early tender deadline will be entitled to $1,017.50 per $1,000 of notes accepted for payment, which includes the early tender payment of $30.00 per $1,000 of notes, plus interest.

Holders who tender their notes after the early tender deadline will receive $987.50 per $1,000 of notes accepted for purchase, plus interest.

Tenders may be withdrawn at any time prior to the early tender deadline.

If the purchase of all validly tendered notes would cause Sunoco to purchase an amount greater than the tender cap, then the tender offer will be oversubscribed and Sunoco, if it accepts notes in the tender offer, will accept for purchase tendered notes on a prorated basis.

If the tender offer is fully subscribed as of the early tender deadline, holders who validly tender notes following the early tender deadline will not have any of their notes accepted for payment.

The tender offer is subject to the satisfaction or waiver of certain conditions, including the debt financing.

If the debt financing is completed but the tender offer is not fully subscribed at an amount equal to the tender cap as of the expiration date, Sunoco intends to use the remaining proceeds from the debt financing to redeem the notes in part.

Sunoco expects the redemption date, if necessary, would take place on or after Jan. 15, and the notes will be redeemed at a price of 101.219, plus interest.

The early settlement date is expected to be on or shortly after Nov. 24.

The offer will expire at 11:59 p.m. ET on Dec. 8.

The final settlement date is expected to be on or shortly after Dec. 9.

Credit Suisse Securities (USA) LLC (800 820-1653 or 212 538-2417) and Barclays Capital Inc. (800 438-3242 or 212 528-7581) are lead dealer managers.

D.F. King & Co., Inc. (866 796-6867, 212 269-5550; sunoco@dfking.com) is the tender agent and information agent.

Sunoco is a Dallas-based wholesale distributor of motor fuels, retailer of motor fuels and operator of convenience stores.

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