CST Brands Announce Dropdown Transactions
Houston, TX-- Paul Hastings LLP, a leading global law firm, announced today that the firm represented CST Brands, Inc. (NYSE:CST) in two dropdown transactions to CrossAmerica Partners LP (NYSE: CAPL) for total consideration of approximately $261.5 million. CST will receive $142.0 million in cash and approximately 3.6 million newly issued CrossAmerica common units as consideration for the transactions. CST Brands owns the general partner of CrossAmerica.
As part of the dropdown transactions, CST Brands has agreed to sell to CrossAmerica the real property associated with 29 recently constructed “New to Industry” stores for an aggregate consideration of approximately $135.5 million and a 12.5% interest in CST Brand’s wholesale fuel business for approximately $126.0 million.
CST’s whole sale fuel supply business provides fuel to substantially all of CST’s U.S. company operated convenience stores and is expected to earn a net profit margin of approximately 5 cents per gallon pursuant to a Fuel Distribution Agreement with a minimum term of 10 years and certain minimum volume commitments.
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