UIL Holdings Acquires Three Natural Gas Companies in the Northeast

Strategic Insights -

UIL Holdings, the holding company for electric distribution company United Illuminating Co., has announced its intention to acquire three natural gas companies in the Northeast for $885 million. The acquisition, which is expected to close by early next year, will create an energy delivery company serving approximately 694,000 customers. The deal includes the purchase of Southern Connecticut Gas Co., Connecticut Natural Gas Corp., and Berkshire Gas Co., as well as $411 million in debt.

The acquisition is part of a larger trend of consolidation in the utility industry, with several major deals announced in recent months. UIL Holdings expects the deal to add to earnings per share in 2012, and intends to issue debt and equity to fund the cash portion of the purchase price. Meanwhile, Iberdrola USA, the parent company of the gas companies being acquired, serves approximately 3 million customers in upstate New York and New England.

Key Takeaways:

  • UIL Holdings will acquire Southern Connecticut Gas Co., Connecticut Natural Gas Corp., and Berkshire Gas Co. for a total of $885 million.
  • The acquisition creates an energy delivery company serving approximately 694,000 customers, including 333,000 natural gas customers in Connecticut and 36,000 in Massachusetts.
  • The deal includes $411 million in debt and is expected to close by early next year.
  • UIL Holdings expects the deal to add to earnings per share in 2012, and will fund the cash portion of the purchase price with debt and equity.
  • Iberdrola USA, the parent company of the gas companies being acquired, serves approximately 3 million customers in upstate New York and New England.
  • The acquisition is part of a larger trend of consolidation in the utility industry, with several major deals announced in recent months.
  • PPL Corp. recently acquired Kentucky's two major utilities for $6.7 billion in a separate deal.

Statistics:

  • $885 million: Total amount of the acquisition
  • 694,000: Number of customers served by the energy delivery company created by the acquisition
  • 333,000: Number of natural gas customers in Connecticut
  • 36,000: Number of natural gas customers in Massachusetts
  • $411 million: Amount of debt included in the deal
  • 3 million: Number of customers served by Iberdrola USA in upstate New York and New England

Sources:

  • " UIL to buy three gas companies in Northeast" Euclid Infotech Pvt. Ltd., provided by Syndigate.info an Albawaba.com company