In a pair of Feb. 2 news releases, Dominion Resources Inc. and SCANA Corporation announced that the two companies closed a deal for the acquisition of Carolina Gas Transmission for approximately $492.9 million, excluding working capital adjustments.
The acquisition by Dominion Resources means that SCANA Corporation is no longer engaged in FERC-regulated open access, transportation-only interstate pipeline operations.
With the acquisition, Dominion Resources will add nearly 1,500 miles of natural gas pipeline, which Carolina Gas Transmission operates in South Carolina and southeastern Georgia. The pipelines transport natural gas from other pipelines (such as Kinder Morgan and Transco) to local utility companies and major industrial facilities.
The transaction includes no assumption of debt and is expected to be immediately accretive to Dominion’s operating earnings per share. McGuireWoods LLP was the company’s legal adviser for the acquisition.
Subject to board approvals by Dominion and Dominion Midstream GP LLC, the general partner of Dominion Midstream Partners LP, Dominion expects to contribute Carolina Gas Transmission into Dominion Midstream by mid-year 2015 for a combination of debt and units.
The contribution of Carolina Gas Transmission is also anticipated to be immediately accretive to Dominion Midstream’s distributed cash flow per unit. This transaction supports the partnership’s intention to grow distributions to unitholders at a best-in-class rate.
Dominion is offering continued employment for Carolina Gas Transmission’s approximately 120-person workforce. In addition, the company has committed to an extended period of rate stability for current Carolina Gas Transmission customers.
Dominion expects to build upon Carolina Gas Transmission’s existing infrastructure growth plans to enable this fully subscribed system to meet the increasing demand for natural gas transportation services in the region.
Dominion’s portfolio includes approximately, 12,400 miles of natural gas transmission, gathering and storage pipeline. It operates one of the nation’s largest natural gas storage systems with 947 billion cubic feet of storage capacity and serves utility and retail energy customers in 12 states.