Marathon Petroleum Borrows $700M for Hess Purchase
FINDLAY, Ohio -- Marathon Petroleum Corp. (MPC) entered into a loan agreement with a syndicate of lenders that will provide it with $700 million to help pay for Speedway LLC's purchase of Hess Retail Holdings LLC.
The $700-million loan will mature in five years following the funding date. MPC has the option to prepay funds without any premium or penalty. The interest rate MPC must pay the bookrunners -- RBS Securities Inc., Bank of Tokyo-Mitsubishi UFJ Ltd., Barclays Bank plc, Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. -- will be determined by a grid-based pricing matrix determined by credit ratings.
Findlay-based MPC will file a Form 8-K with the U.S. Securities and Exchange Commission regarding the loan agreement prior to Sept. 2.
MPC's Speedway division announced in May it would purchase Hess' retail network of 1,256 stores for a total consideration of $2.874 billion. The transaction is expected to close by the end of the year.
Once the sale becomes official, MPC's Speedway division will become the second-largest convenience store chain in the United States in terms of quantity of stores, operating 2,733 locations in 23 states.