Valero Energy Corp. is considering a separation of its retail business from refining and other operations, according to Chairman and Chief Executive Officer Bill Klesse.
“We believe a separation of our retail business from the remainder of Valero by way of a tax-efficient distribution will create operational flexibility within the businesses and unlock value for our shareholders,” Klesse said in an announcement of the company’s second-quarter financial results.
Valero operates 16 refineries, all in the US except for one in Canada and one in the UK, with total throughput capacity of 3 million b/d. Its average refinery size is 187,000 b/d. It also owns 10 corn ethanol plants in the US with combined capacity of 72,000 b/d.
Valero’s retail business includes about 6,800 branded marketing sites in the US and Canada, including nearly 1,300 sites operated by the company.
“As independent companies, both retail and the remaining business will be better-positioned to focus on their industry-specific strategies,” Klesse said.
He said Valero is considering several separation transactions, including a distribution of the retail business to Valero shareholders.
Valero reported net income attributed to shareholders from continuing operations of $831 million in the second quarter of 2012, compared with $745 million in the same quarter last year.