Utility company Dominion Resources, Inc. (D) has agreed to purchase Carolina Gas Transmission or CGT from SCANA Corp. (SCG) for around $492.9 million. CGT owns and operates around 1,500 miles of FERC-regulated interstate natural gas pipeline in South Carolina and southeastern Georgia. The firm intends to close on the acquisition in January 2015.
The transaction would include no assumption of debt and, upon closing, would be immediately accretive to Dominion's operating earnings per share.
Dominion hopes to contribute CGT into Dominion Midstream for a combination of debt and units by mid-year 2015, subject to board approvals by Dominion and Dominion Midstream Partners, LP (DM). Dominion, via. certain of its subsidiaries, owns nearly 68.5 percent limited partner interest in Dominion Midstream, in addition to its general partner, and all associated incentive distribution rights. Dominion would update its strategic plan at its February 9, 2015, Analyst Meeting.
The contribution of CGT is expected to be immediately accretive to Dominion Midstream's distributed cash flow per unit and supportive of Dominion Midstream's intention to grow distributions to unit-holders at a best-in-class rate.
Pursuant to the acquisition deal, Dominion is offering continued employment for CGT's approximately 120-person workforce. The transaction would require Hart-Scott-Rodino antitrust clearance.
Separetely, Scana announced signing a deal for the sale of SCANA Communications or SCI to Spirit Communications. SCI owns and operates a 1,125 mile fiber optic telecommunications network and Ethernet network and provides tower site construction, management and rental services in South Carolina, North Carolina and Tennessee.
As a result of these sales, the $325 million in equity issuances which were expected to occur during 2015, including $100 million from SCANA's dividend reinvestment plan and its employee 401(k) plan, would be eliminated from the Company's financing plan, Scana added.
RBC Capital Markets LLC is serving as the exclusive financial advisor to SCANA on the sale of CGT and Stephens Inc. is serving as the exclusive financial advisor to SCANA on the sale of SCI.
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