Carlyle Group, a private-equity fund, is pushing to seal a deal to buy a large Sunoco oil refinery in Philadelphia that could save hundreds of jobs, CNBC.com reported, citing three people familiar with the matter.
Washington-based Carlyle has been in talks with Sunoco since mid-April to purchase the plant, nicknamed SunPhilly, which was slated to be idled in August, putting 800 people out of work, if Sunoco couldn’t find a buyer for the plant, the report said.
An exclusivity agreement on the 330,000-barrel-per-day plant that was signed in April is set to expire Friday if the deal can’t be finalized, one of the people said. Carlyle and Sunoco executives were meeting in the oil company’s Philadelphia headquarters Wednesday, seeking to hammer out a final agreement, two of the people said. The exclusivity agreement could also be extended, one of the people familiar with the matter said.
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Any agreement would come a month and a half after Delta Air Lines bought a smaller refinery in Trainer, Penn., for $180 million. As part of that deal, the state of Pennsylvania pledged $30 million in subsidies to save local jobs. Delta, marking a first such purchase for an airline, was seeking to save money on fuel, CNBC reported.
Carlyle is negotiating for a bargain price on the plant, one of the people familiar with the matter said. Carlyle said in April it would contribute cash to the refinery as part of a joint-venture arrangement by which Sunoco would retain a minority, non-operating stake in the plant. Carlyle would oversee day-to-day operations, and would be responsible for shipping oil to the plant and managing the refining process, the fund said in a statement.
Carlyle, which went public earlier this year, has secured commitments of at least $2 billion for its flagship buyout fund, Bloomberg News reported, citing two people familiar with the matter. Carlyle, among the last of the largest buyout firms to start building a flagship fund, is seeking about $10 billion for the fund, the report said.
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