Duke Energy acquiring Piedmont Natural Gas for $4.9 billion in c - | WBTV Charlotte

Duke Energy acquiring Piedmont Natural Gas for $4.9 billion in cash


Duke Energy says they will acquire Piedmont Natural Gas for approximately $4.9 billion in cash. The announcement was made Monday morning.

The boards of directors unanimously approved a definitive agreement for Duke Energy to acquire Piedmont Natural Gas.

The companies are key partners in the $5 billion Atlantic Coast Pipeline that will be the first major natural gas pipeline to serve eastern North Carolina.

"We look forward to welcoming Piedmont's employees and one million customers in the Carolinas and Tennessee to Duke Energy," President and CEO of Duke Energy Lynn Goode said. "This combination provides us with a growing natural gas platform, benefiting our customers, communities and investors."

When asked further about what this transaction could mean for workers at Piedmont, spokesperson for Duke Energy Tom Williams explained the focus is on growth.

"There's very little overlap with the corporate offices. There is some and we'll be looking at those but in many cases we'll welcome new folks aboard," Williams said.

Piedmont shareholders will receive $60 in cash for each share of Piedmont Natural Gas common stock, Duke Energy says. There is around a 40 percent premium to Friday's closing price.

Duke Energy will assume around $1.8 billion of Piedmont Natural Gas existing net debt, representing a total enterprise value of around $6.7 billion, the company says.

The combined companies will have a total of 31,100 employees (Duke Energy: 29,200; Piedmont: 1,900).

A spokesperson for Piedmont Natural Gas, David Trusty explained about 1,600 of those workers are based in North Carolina, 700 being in Charlotte. He also explained what this could mean for their customers' bills.

"There won't be any change. You're still going to get your bill from Piedmont Natural Gas. Your rates are not going to go up as a result of this agreement between our companies. You're still going to receive natural gas service through the same pipes and same pipelines that you've always had. For our customers, this isn't going to impact your natural gas service," Trusty said. 

"The strategic combination of our two companies will deliver compelling value to our shareholders, greatly expand our platform for future growth, enhance our ability to provide excellence in customer service and give our employees more opportunities in one of the largest energy companies in the United States," said Tom Skains, chairman, president and CEO of Piedmont Natural Gas.

Duke Energy says Piedmont Natural Gas will retain its name and operate as a business unit of Duke Energy, maintaining its headquarters in southeast Charlotte. One of Piedmont Natural Gas' directors will joint Duke's board.

Skains says it is an exciting moment for Piedmont Natural Gas and its shareholders, customers and employees. Piedmont Natural Gas began operations in 1951 in Charlotte.

Duke Energy was founded in 1904.

These companies have been operating here in Charlotte for a long time, and there may be a sentimental connection for Piedmont shareholders. A financial adviser, Paul Durso with Durso Capital Management explained people in a situation like this one have a lot to think about.

"When you've had something in your life forever, not only your life but your parent's life it's always tough to put a price tag on sentimental value. Actually, it's impossible to put a price on sentimental value. So situations like this force conversations," Durso said, "Conversations are never a bad thing. As far as the merger being good or bad, I'm not the person to ask but when it comes to having a conversation with the spouse should we keep or sell what should we do with our stock, this is the perfect opportunity for that."

Durso says you don’t want to rush into any decision.

The companies target to close by the end of 2016. Piedmont shareholders and the North Carolina Utilities Commission still need to approve the acquisition. 

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