Utility holding company Laclede Group (NYSE: LG) announced today that it will acquire two of Southern Union's utilities for $1.015 billion in cash and $20 million of assumed debt.
Southern Union is owned by ETP Holdco, in which Energy Transfer Partners (ETP) and Energy Transfer Equity (ET 0.44%) have controlling and non-controlling interests, respectively. The two utilities, Missouri Gas Energy and New England Gas Company, serve more than 550,000 customers and pulled in combined FY 2012 revenue of $517 million.
According to Suzanne Sitherwood, Laclede president and CEO, the new acquisitions will roughly double Laclede's customer base and provide further opportunities to leverage Laclede's shared services approach, scale, and operational expertise.
"We are pleased to be selling to a buyer that remains committed to maintaining high standards of service quality and operational excellence for the customers and employees of Missouri Gas Energy and New England Gas Company," said Kelcy Warren, Energy Transfer Partners CEO and chairman, in a statement.
Laclede expects its purchase to reach profit neutrality in the first full year, with positive earnings-per-share thereafter. The deal is expected to close by the third quarter of 2013.
