Tesoro Corp. (NYSE: TSO) announced that it that is has agreed to purchase BP PLC?s (NYSE: BP) integrated Southern California refining and marketing business for $1.18 billion, plus the value of inventory at the time of closing.
At current prices, the inventory is valued at about $1.3 billion. The deal is expected to close before mid-2013.
?This transaction is a unique opportunity for Tesoro to combine the best aspects of two West Coast refining and marketing businesses resulting in a more efficient integrated refining, marketing and logistics system,? said Greg Goff, president and CEO of Tesoro. ?Given Tesoro?s existing operations on the West Coast and our understanding of the complexities and challenges of operating in California, we are well positioned to generate significant operational efficiencies, increase our ability to satisfy market demand and reduce stationary source air emissions.?
The Carson refinery is located south of Los Angeles and is adjacent to Tesoro?s Wilmington refinery. The combined and reconfigured operations are expected to drive annual synergies of about $250 million, with an additional capital investment of around $225 million.
The transaction also includes approximately 800 dealer-operated retail stations in Southern California, Nevada and Arizona. Tesoro will acquire the well-established ARCO brand and a master franchisee license for the ampm convenience store brand.
Top Analyst Upgrades and Downgrades (BBBY, CPB, KO, COP, EOG, FIVE, F, GOOG, IP, JCP, LMCA, KORS, NEE, NYT, P, SCHN, SODA, S,?YHOO)Source: http://247wallst.com/2012/08/13/tesoro-to-buy-bp-refining-and-marketing-business/
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