Sunoco 2011 Annual Report Download - page 109

and disbursements are processed together with those of Sunoco and its other subsidiaries through Sunoco’s cash
accounts with a corresponding intercompany receivable or payable. In August 2010, the Partnership issued a
three-year, subordinated, $100 million note to Sunoco in connection with the funding for its purchase of the
butane blending business from Texon. The note was repaid in December 2011.
Cokemaking Operations
On July 12, 2011, Sunoco borrowed $300 million from an affiliate of one of SunCoke Energy’s IPO
underwriters. On July 26, 2011, an IPO of 13.34 million shares of SunCoke Energy common stock was
completed at an offering price of $16 per share. Sunoco’s $300 million borrowing was satisfied at the closing of
the SunCoke IPO through an exchange of the 13.34 million shares of SunCoke Energy stock valued at $213
million and a cash payment of $87 million. Sunoco also incurred underwriters’ commissions and other expenses
totaling $21 million in connection with the offering. At December 31, 2011, Sunoco maintained a controlling
financial interest in SunCoke Energy through its ownership of 81 percent of the outstanding shares of SunCoke
Energy common stock. In connection with the SunCoke IPO, Sunoco recorded a $112 million increase in
noncontrolling interests and an $80 million increase in capital in excess of par value. On January 17, 2012, the
Company completed the separation of SunCoke Energy from Sunoco by distributing its remaining shares of
SunCoke Energy common stock to Sunoco shareholders by means of a spin-off. The distribution was in the form
of a pro rata stock dividend which entitled Sunoco shareholders of record on January 5, 2012 to receive 0.53 of a
share of SunCoke Energy common stock for each share of Sunoco common stock held. The results of operations
of the Coke business will be classified as discontinued operations in the consolidated statements of operations
effective with the distribution date. This transaction will be accounted for as a reduction to equity at carrying
value in accordance with current accounting guidance. SunCoke Energy generally assumed all liabilities
associated with Sunoco’s cokemaking and coal businesses prior to the date of the spin-off. SunCoke Energy is
also responsible for all tax liabilities related to Sunoco’s cokemaking and coal businesses prior to the spin-off.
However, SunCoke Energy is not entitled to any refunds which may occur that are applicable to such periods.
In September 2011, SunCoke Energy purchased a portion of the noncontrolling interest in its Indiana Harbor
cokemaking operations for $34 million. The transaction was accounted for as an equity transaction and resulted
in a $24 million decrease in noncontrolling interests and a $6 million decrease in capital in excess of par value,
net of income taxes. The noncontrolling interest in the Indiana Harbor cokemaking operations declined from 34
percent to 15 percent as a result of this transaction.
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