When Valero Energy Corp. (NYSE: VLO) reported second quarter earnings last July, the company said it would seek a tax-efficient spin-off of its retail business. In a presentation to investors today, the company offered a little more detail about the proposed spin-off.
The company has said the spin-off "will create operational flexibility within the businesses and unlock value for our shareholders."
The company noted in its presentation today that it has requested a private-letter ruling from the Internal Revenue Service in October and that the spin-off company, to be called Corner Stores Holdings Inc., filed a draft Form-10 registration form with the SEC in November. Valero intends to distribute 80% of Corner Stores' equity to current Valero shareholders. Corner Stores will trade on the NYSE under the ticker symbol 'CST'.
Valero said it expects the spin-off to be completed late in the first quarter or early in the second quarter of 2013.
Phillips 66 (NYSE: PSX) and Marathon Petroleum Corp. (NYSE: MPC) both retained their retail outlets when the downstream businesses were spun off from their parent companies. Neither has indicated that a spin-off similar to Valero's is in the making.
Among its other strategic priorities, Valero said today that it will continue to "evaluate dispostions of poor performing assets," continue with its conversion of the shuttered Aruba refinery to a terminal, evaluate potential acquisitions, and continue to upgrade its product streams, while also returning available cash to shareholders.
Valero's shares are up 2.2% today at $32.57 in a 52-week range of $19.12 to $34.36.
Filed under: 24/7 Wall St. Wire, Commodities, Oil & Gas Tagged: MPC, PSX, VLO