Energy Transfer Partners closes deal for Sunoco

DALLAS -- Energy Transfer Partners LP said Friday that it completed its acquisition of Sunoco Inc. for about $5.5 billion, creating one of the more diverse pipeline companies in the country.

Under the terms of the deal, Sunoco shareholders could receive for each of their shares their choice of a combination of $25 in cash and 0.5245 of an Energy Transfer Partners common unit, $50 in cash or 1.0490 Energy Transfer Partners common units. Because more people chose the cash option, those shareholders will receive a prorated amount of cash and some units, the company said.

Energy Transfer Partners said holders of about 2.6 percent of Sunoco's outstanding shares chose the cash and units combination, while 72.4 percent chose the cash and about 4.2 percent took the units. About 20.8 percent of shareholders didn't make a choice and therefore will get the cash and units combination.

In total, Energy Transfer Partners will pay $2.6 billion in cash and 55 million common units. Based on their Thursday closing stock price, the units are worth about $2.29 billion.

Energy Transfer is primarily a natural gas pipeline company. Sunoco's pipeline network will allow Dallas-based Energy Transfer to expand into moving crude oil and refined petroleum products from the Great Lakes and Northeast to American's refining center along the Gulf Cost.

Sunoco's pipelines have been in high demand recently, thanks to a boom in drilling for gas and oil in U.S. shale rock formations.

Sunoco shares ceased trading effective Friday morning. Energy Transfer Partners units rose $1.63, or 3.9 percent, to $43.25 in morning trading.