26 Jan AltaGas in $6.4b WGL holdings acquisition in natural gas push
Canadian energy infrastructure group AltaGas (TSX:ALA) announced it will buy US-based WGL Holdings Inc (NYSE:WGL) in a deal worth US$6.42 billion.
The deal represents AltaGas’ motivation to delve deeper into the natural gas industry in the United States, as WGL is the parent company of Washington Gas, who provide natural gas services to Maryland, Virginia and the District of Columbia.
The company currently has three operations across the US and Canada – natural gas gathering and processing, power generation and utilities that deliver natural gas.
“We look forward to welcoming WGL employees and customers to AltaGas,” said David Harris, president and CEO of AltaGas. “This acquisition provides us with a robust, complementary set of energy businesses that greatly increase our scale and diversity.”
AltaGas is also expecting to benefit from WGL’s existing oil pipeline assets as well as receiving a ‘stable cash flow’ from its portfolio of clean power assets.
“The strategic fit and compatibility of our two companies is exceptional. Both companies are strong utility operators, have a sweet spot of pipeline and midstream investments in premier supply basins, and have power generation businesses weighted to clean energy and innovations,” said Harris.
WGL chairman and CEO Terry McCallister added: “AltaGas shares our values, including maintaining the strong working relationships we have developed with our regulatory agencies. The WGL team looks forward to contributing to AltaGas’ future and the opportunities for growth across the organisation.”
The purchase is expected to be completed by the end of the second quarter of 2018.