Sunoco 2008 Annual Report Download - page 78

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The purchase price has been allocated to the assets acquired and liabilities assumed based on their relative
fair market values at the acquisition date. The following is a summary of the effects of the acquisition and related
loss on Sunoco’s consolidated financial position (in millions of dollars):
Increase in:
Properties, plants and equipment, net ...................................... $ 47
Deferred charges and other assets ........................................ 11*
Decrease in:
Deferred income taxes .................................................. 2
Minority interests ....................................................... 92
Shareholders’ equity .................................................... 3
Cash paid for acquisition ............................................... $155
* Consists of $3 million allocated to goodwill and $8 million allocated to a sales contract with a customer.
No pro forma information has been presented since the impact of the acquisition was not material in relation
to Sunoco’s consolidated results of operations.
Divestments
Retail Portfolio Management Program—During the 2006-2008 period, Sunoco generated $133 million of
divestment proceeds related to the sale of 181 sites under a Retail Portfolio Management (“RPM”) program to
selectively reduce the Company’s invested capital in Company-owned or leased retail sites. Most of the sites
were converted to contract dealers or distributors thereby retaining most of the gasoline sales volume attributable
to the divested sites within the Sunoco branded business. During 2008, 2007 and 2006, net gains of $4, $35 and
$17 million, respectively ($3, $21 and $10 million after tax, respectively) were recognized as gains on
divestments in other income, net, in the consolidated statements of income in connection with the RPM program.
Included in the 2008 divestment gains are impairment losses and associated costs totaling $10 million ($6 million
after tax) related to certain properties held for sale. In early 2009, Sunoco announced the addition of
approximately 150 sites to the RPM program. There are currently approximately 200 sites in the program, of
which approximately 110 are Company-operated locations. These sites are expected to be divested or converted
to contract dealers or distributors primarily over the next two years.
Other Matters
Asset Write-Downs and Other Matters—The following table summarizes information regarding the
provision for asset write-downs and other matters recognized during 2008 and 2007 (in millions of dollars):
Pretax
Provisions
After-Tax
Provisions
2008
Tulsa refinery .............................................. $160 $ 95
Bayport chemical plant ....................................... 55 35
Polypropylene business goodwill ............................... 31 19
MTBE litigation insurance recovery ............................. (18) (11)
$228 $138
2007
Haverhill chemical plant production line ......................... $ 13 $ 8
Neville Island terminal facility .................................. 12 7
MTBE litigation settlement .................................... 28 17
$53 $32
70