Sunoco 2012 Annual Report Download - page 90

The Partnership had $31 million of undistributed earnings from its investments in corporate joint ventures
within Equity at December 31, 2012. During the periods from October 5, 2012 to December 31, 2012, from
January 1, 2012 to October 4, 2012, and for the years ended December 31, 2011 and 2010, the Partnership
received dividends of $6, $5, $11 and $15 million, respectively, from its investments in corporate joint ventures.
9. Goodwill and Other Intangible Assets
Goodwill
Goodwill represents the excess of consideration transferred plus the fair value of noncontrolling interests of
an acquired business over the fair value of net assets acquired. Goodwill is not amortized; however it is subject to
at least an annual impairment testing. The Partnership’s goodwill balance at December 31, 2012 and 2011 was
$1,368 and $77 million, respectively. The increase in the Partnership’s goodwill balance at December 31, 2012
related to the adjustment of its assets and liabilities to fair value resulting from the application of push-down
accounting in connection with the acquisition of the general partner by ETP (Note 1). The Partnership’s goodwill
balance increased to $77 million at December 31, 2011 from $63 million at December 31, 2010 related to the
acquisition of a crude oil acquisition and marketing business in August 2011.
Identifiable Intangible Assets
The Partnership’s identifiable intangible assets are comprised of customer relationships, which consist of
throughput contracts and historical shipping rights, and technology related assets, which consist of patented
technology associated with the Partnership’s butane blending services. The values assigned to these intangible
assets are amortized to earnings using a straight-line approach, over a weighted average amortization period of
approximately 17 years. Amortization expense related to these intangibles was $12, $20, $15 and $4 million for
the periods from October 5, 2012 to December 31, 2012, from January 1, 2012 to October 4, 2012, and for the
years ended December 31, 2011 and 2010, respectively.
Customer relationship intangible assets represent the estimated economic value assigned to certain
relationships acquired in connection with business combinations or asset purchases whereby (i) the Partnership
acquired information about or access to customers, (ii) the customers now have the ability to transact business
with the Partnership and (iii) the Partnership is positioned due to limited competition to provide products or
services to the customers. Technology-related intangible assets are the Partnership’s patents for blending of
butane into refined products. These patents are amortized over their remaining legal lives.
Successor Predecessor
Weighted Average
Amortization Period
December 31,
2012
December 31,
2011
(in millions) (in millions)
Gross
Customer relationships ........................... 19 $808 $239
Technology .................................... 10 47 58
Total gross ................................ 855 297
Accumulated amortization
Customer relationships ........................... (11) (14)
Technology .................................... (1) (6)
Total accumulated amortization .............. (12) (20)
Total Net .......................................... $843 $277
As of December 31, 2012, the Partnership forecasts $49 million of annual amortization expense for each
year through the year 2017 for these intangible assets.
Intangible assets attributable to rights of way are included in properties, plants and equipment in the
Partnership’s consolidated balance sheets at December 31, 2012 and December 31, 2011.
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