US: Duke Energy to acquire Piedmont Natural Gas for $4.9 billion

Duke Energy agreed to acquire Piedmont Natural Gas for $4.9 billion in cash, adding a distributor of cheap shale gas as growth in power demand slows.

Duke follows electric utility owners Southern, Emera Inc. and Black Hills Corp. which have acquired gas distributors in the past 12 months. The deal increases Duke’s stake in the $5 billion Atlantic Coast Pipeline to 50 percent. When completed, the line will link gas fields in West Virginia to Duke’s service area in North Carolina.

“It’s opening Duke’s door into the gas infrastructure business,” Shahriar Pourreza, a New York-based analyst for Guggenheim Securities, said Monday in a phone interview. “Utilities are going through a period where organic growth is slowing down, so they have to grow through acquisitions. Everybody wants to be in the gas infrastructure business.”

Piedmont shareholders will receive $60 in cash for each share of Piedmont common stock, about a 40 percent premium to the Oct. 23, closing price, the companies said Monday in a statement. Duke will assume about $1.8 billion in Piedmont’s net debt, representing an enterprise value of about $6.7 billion.

Full content: The Charlotte Observer

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