Investors who have long been anticipating Valero’s(VLO) spinoff of retail division CST Brands(CST) won’t have to wait much longer. According to Convenience Store News, Valero Chief Financial Officer Mike Ciskowski said at a recent luncheon that the company was just waiting for an IRS ruling that the transaction would be tax free to shareholders, and for final Board approval. He said that such a ruling typically takes between four and six months and that the company had filed five months ago. Board approval would quickly follow.
Once these steps are complete, Valero will distribute 80% of CST to shareholders and sell the remaining 20% over the year that follows. Valero’s retail operation of 1900 convenience stores and gas stations including 1032 in the United States is thought to be undervalued when combined with the firm’s core refining business. The company expects that significant value will be unlocked by executing this spinoff.
Disclosure: The author holds no shares in any stock mentioned
Related articles
- Valero faces one hurdle before retail separation (mysanantonio.com)
- Valero Cancels Sale of California Refineries (blogs.wsj.com)
appears to be somewhat similar to the MRO-MPC spinoff