Southern Co. to Buy AGL Resources for $8 Billion -- 2nd Update
August 24 2015 - 10:52AM
Dow Jones News
By Chelsey Dulaney
Southern Co. has agreed to buy natural-gas company AGL Resources
for about $8 billion, a deal that will create the second-largest
utility company in the U.S. by customers.
Under the terms of the deal, AGL Resources shareholders will
receive $66 in cash for each share held, a 38% premium to AGL's
closing price on Friday of $47.86 a share.
Including debt, the deal is valued at $12 billion. Both
companies' boards of directors have approved the deal.
Shares of AGL traded recently at $60.99, up 27% but still well
below the offer price, while Southern shares dropped 2.9% as global
stocks were routed.
The combined company will have around 9 million customers and
operate 11 regulated electric and natural gas distribution
companies.
Atlanta-based Southern owns electrical utilities throughout the
Southeast and also has competitive generation, fiber optics and
wireless communications businesses.
AGL, also based in Atlanta, provides regulated gas distribution
and serves retail customers under its SouthStar Energy Services and
Pivotal Home Solutions ventures.
"For some time we have expressed our desire to explore
opportunities to participate in natural gas infrastructure
development," said Southern Chief Executive Thomas Fanning in a
news release.
Southern expects the deal to add to its per-share earnings in
the first full year after closing, which is expected in the second
half of 2016.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 24, 2015 10:37 ET (14:37 GMT)
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