Fitch: Energy Transfer Partners negative, Sunoco stable

Fitch Ratings said it affirmed Energy Transfer Partners, LP's ratings with a negative outlook and Sunoco, Inc.'s ratings with a stable outlook following the announcement that Transfer Partners will acquire Sunoco.

The agency affirmed Energy Transfer Partners' issuer default rating and senior debt at BBB-.

Fitch affirmed Sunoco's issuer default rating and senior debt at BB+ and its senior secured revolver at BBB-; Sunoco Logistics Partners LP's long-term issuer default rating at BBB; and Sunoco Logistics Partners Operations LP's long-term issuer default rating, senior debt and senior bank facilities at BBB and its short-term issuer default rating at F2.

The agency said Energy Transfer Partners' affirmation considers the benefits of scale and diversity provided by the Sunoco acquisition, the limited amount of new debt required to complete the transaction and modestly favorable impact on its leverage metrics.

The negative outlook reflects the company's aggressive acquisition and organic growth activities, the associated transactional risk and the impact these activities have on credit metrics, the agency said. Fitch expects its debt-to-EBITDA ratio to remain more 4 times through 2013.

Sunoco's affirmation is driven by the company's currently high liquidity, solid adjusted leverage metrics and ongoing transition from a manufacturing to a more ratable, distribution driven business, Fitch said. These factors are balanced by the reduced business diversification following the SunCoke spinoff, chemicals asset sales and pending exit from refining and the increased structural subordination of debt at the Sunoco parent level to debt at Sunoco Logistics, the agency said.

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