CenterPoint Energy Inc. announced April 29 the sale of its Arkansas and Oklahoma natural gas LDC assets to Summit Utilities for $2.15 billion in cash.
The deal also includes recovery of approximately $425 million in cash of unrecovered storm-related incremental natural gas costs incurred in February 2021. The assets include approximately 17,000 miles of main pipeline in Arkansas, Oklahoma and Texarkana, Texas, serving more than 500,000 customers.
The transaction is anticipated to close by the end of 2021, subject to customary closing conditions, including Hart-Scott Rodino antitrust clearance and state regulatory approvals.
Summit Utilities owns natural gas distribution and transmission subsidiaries, including Colorado Natural Gas Inc., Summit Natural Gas of Missouri Inc., Summit Natural Gas of Maine Inc. and Arkansas Oklahoma Gas Corp. Overall, Summit entities serve approximately 100,000 customers and operate more than 5,400 miles of pipeline in Arkansas, Colorado, Maine, Missouri and Oklahoma.
“Summit Utilities is a seasoned operator of utility assets in the region and the ideal company to acquire these assets,” said CenterPoint president and CEO Dave Lesar. “We are excited that Summit has existing businesses in Arkansas and Oklahoma, which will facilitate the transition process for our employees and customers. Summit has an industry track record of being a high-quality operator and we are confident they will continue to provide safe, reliable and low-cost natural gas service to our customers in Arkansas and Oklahoma.”
Lesar added that the transaction aligns with the CenterPoint’s stakeholder commitments, as outlined in the company’s December 2020 Investor Day, which included delivering annualized utility earnings per share growth of 6 to 8 percent and growing its rate base at a 10 percent compound annual growth rate.
J.P. Morgan Securities LLC and RBC Capital Markets LLC served as CenterPoint Energy’s financial advisors. Baker Botts LLP served as the company’s legal advisor.
CenterPoint is an investor-owned electric and gas utility based in Texas, and provides electric transmission and distribution, power generation and natural gas distribution services for more than 7 million customers in Arkansas, Indiana, Louisiana, Minnesota, Mississippi, Ohio, Oklahoma and Texas.Tags: CenterPoint Energy, gas distribution, mergers and acquisitions, Summit Utilities