ENB Enbridge Inc

By Stephen Nakrosis

Enbridge on Tuesday said it agreed to purchase three U.S. based utilities from Dominion Energy, which will facilitate the creation of the largest natural gas utility franchise in North America.

The $14 billion deal will see Enbridge acquire the East Ohio Gas Company, Public Service Company of North Carolina, and Questar Gas and its related Wexpro companies.

Enbridge said the purchase price comprises a $9.4 billion cash consideration and $4.6 billion of assumed debt. It said it obtained debt financing commitments totaling $9.4 billion from Morgan Stanley and Royal Bank of Canada for the cash consideration component of the deals. Enbridge also carried out a $4 billion Canadian dollar ($2.93 billion) bought-deal offering of common shares on Tuesday, which it said is expected to "fully address the company's planned discrete common equity issuance needs to finance this transaction."

According to Enbridge, the deal is expected to be accretive to distributable cash flow per share and adjusted earnings per share in the first full year of ownership. Utility cash flows from acquired businesses will balance Enbridge's earnings mix to about 50% natural gas and renewables and 50% liquids when the deal closes, which is expected to happen next year.

Dominion said the sale comes amid its ongoing business review, adding it now expects to conclude the review and announce its repositioned outlook during the fourth quarter of this year.

Enbridge shares were trading lower in Tuesday's after-hours market following the news. At 4:50 p.m. ET, the stock had fallen 7.28% to trade at $32.75.

Around the same time, shares of Dominion Energy were down 9.6%, trading at $46.50.

Write to Stephen Nakrosis at stephen.nakrosis@wsj.com

(END) Dow Jones Newswires

September 05, 2023 17:12 ET (21:12 GMT)

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