Credit: Shutterstock photoSempra Energy 's SRE unit, Sempra U.S. Gas & Power, closed the sale of EnergySouth, Inc., the parent company of Mobile Gas Service Corp. and Willmut Gas & Oil Company, to Spire Inc. SR .
Details of the Transaction
The divestment was announced by the company earlier this year. Its total consideration includes cash proceeds of $320 million and Spire's assumption of EnergySouth's existing debt of $67 million.
The transaction covers the sale of Mobile Gas and Willmut Gas only. Sempra U.S. Gas & Power will continue to possess Bay Gas Storage Co., Mississippi Hub, LLC, Liberty Gas Storage and Southern Gas Transmission, all of which were part of EnergySouth. Note that EnergySouth was acquired by Sempra U.S. Gas & Power in 2008.
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Rationale behind the Sale
According to Patti Wagner, president and CEO of Sempra U.S. Gas & Power, the company had come to decision to sell the two utilities after assessing its natural gas assets. The company believes that the proceeds from the sale could be deployed for long-term growth opportunities that are in sync with its business strategy.
About Mobile Gas & Willmut Gas
Mobile Gas serves nearly 85,000 residential, commercial and industrial customers in Mobile and Baldwin Counties of southwest Alabama.
On the other hand, Willmut Gas, which was acquired by Sempra U.S. Gas & Power in 2012, serves approximately 19,000 residential, commercial and industrial customers in greater Hattiesburg, MS (covering portions of Forrest and Lamar Counties); and portions of Covington, Jones, Simpson and Rankin Counties.
About Sempra U.S. Gas & Power
Sempra U.S. Gas & Power develops clean power solutions in markets across the U.S., with a focus on zero- and low-emission fuels. The company operates more than 1,500 megawatts ("MW") of renewable and natural gas-fueled power plants, including the largest photovoltaic solar facility in the U.S.
Zacks Rank & Key Picks
Sempra Energy currently has a Zacks Rank #4 (Sell). A couple of better-ranked stocks in the same industry include Piedmont Natural Gas Co. Inc. PNY and ONE Gas, Inc. OGS , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
