Sunoco Logistics Partners LP said Tuesday it has completed its acquisition of the MagTex refined products pipeline system from affiliates of Exxon Mobil Corp.
The Philadelphia-based partnership agreed to pay $175 million for the system, which is in Texas, in April. Sunoco Logistics (NYSE:SXL) said the terms of the original purchase agreements were amended to provide for potential adjustments, based on the volume of products the system actually handles, to the purchase price, the rate it charges pipeline users, and commitments made by Exxon Mobil (NYSE:XOM) to transporting its products through the pipeline.
Sunoco Logistics expects the transaction to be immediately accretive to the amount of cash available for distribution to its limited partners. To help make that happen, the partnership’s general partner has agreed to reduce the cash distributions it is eligible to receive from its incentive distribution rights by $5.5 million over four years.
Sunoco Logistics funded the acquisition from its revolving credit facility.
Sunoco Logistics owns and operates crude oil and refined petroleum product pipelines and terminal facilities. Sunoco Inc. (NYSE:SUN), the Philadelphia oil refiner, owns 43.4 percent of its limited partner shares.