Canada's AltaGas to Buy D.C. Utility WGL
January 25 2017 - 10:05PM
Dow Jones News
By Maria Armental
Canada's AltaGas Ltd. reached a $6.4 billion deal to buy WGL
Holdings Inc., Washington, D.C.'s natural-gas utility, more than
tripling its customer base.
The price -- based on $88.25 a share, a 12% premium over
Wednesday's closing -- is above the range The Wall Street Journal
had reported this month, citing people familiar with the
matter.
The deal, subject regulatory and WGL shareholders' approval, is
expected to close by the end of the second quarter of 2018.
WGL, which will continue to operate as a stand-alone utility
based in the U.S., runs Washington Gas, the former Washington Gas
Light. Co., founded by a congressional charter in 1848 and that
currently serves more than 1 million customers in the D.C.
metropolitan area.
Calgary-based AltaGas secured a $4.95 billion bridge loan from
J.P. Morgan Chase Bank, Toronto-Dominion Bank, and Royal Bank of
Canada. It will ultimately pay for the deal through a private
placement of subscription receipts to Ontario Municipal Employees
Retirement System, one of Canada's largest pension funds, and a
so-called public bought issue of subscription receipts, along with
additional debt, preferred shares and hybrid securities.
Company officials, who didn't take questions during a conference
call on Wednesday, said the deal would boost per-share profit and
dividend payouts by about 8% to 10% through 2021.
WGL's stock, up 26% over the past 12 months, rose 3.4% to $81.49
in after-hours trading.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
January 25, 2017 21:50 ET (02:50 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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