Privately held Summit Utilities is doubling its customer base and expanding into Arkansas and Oklahoma with the acquisition of family owned A.O.G. Corp. and its subsidiary Arkansas Oklahoma Gas Corp. (AOG), a company that has deep roots in Arkansas and the early days of the natural gas industry.
A.O.G. serves nearly 60,000 natural gas customers in Arkansas and Oklahoma. It will be joining existing Summit operations in Colorado, Missouri and Maine (see Daily GPI, Feb. 26, 2015). Summit specializes in providing gas utility service to underserved regions.
Littleton, CO-based Summit Utilities is acquiring 100% of the equity of A.O.G. Corp. Closing of the transaction is expected within six to eight months. Other terms of the deal were not disclosed.
AOG has been owned by the family of Witt Stephens Sr. for 72 years. "AOG has been a constant presence in our family," said Witt Stephens Jr. "It was important to our family that any acquirer of AOG continue its high standard of ethical and fair treatment of AOG's customers and employees. We have confidence that Summit Utilities will continue those traditions and provide new opportunities for the employees as they focus on further growing the business."
Witt Stephens Sr., aka Wilton Robert Stephens, was born in 1907 and died in 1991, according to his lengthy entry in The Encyclopedia of Arkansas History & Culture.
"After World War II, Stephens began to acquire extensive natural gas interests and, in a few years, controlled most of the gas production and distribution in [Arkansas]," the entry reads. "When [President] Roosevelt tried to break up utility holding companies in 1945, Stephens paid $1.2 million for the Fort Smith Gas Co. (now Arkansas Oklahoma Gas Co.).
"The company owned no gas reserves, so in 1953, Stephens bought the Oklahoma Producing Co. for $6.5 million and assigned its transmission property to his new gas company and the rest to Stephens Production Co., a new natural gas exploration company. Stephens developed vast reserves of natural gas in Arkansas, Texas, Oklahoma, and Louisiana, as well as bituminous coal in Wyoming."
According to the encyclopedia, in 1954, Stephens acquired Arkansas Louisiana Gas Co. (Arkla) from Cities Service Co. He improved summer gas sales by pushing gas appliances, including gas air-conditioning units. "Earnings rose from $1.8 million in 1954 to $7.2 million in 1956. Stephens's investment company sold most of the stock in the gas company in 1956 to avoid registering as a utility holding company," according to the encyclopedia.
In 1956, Stephens became president and chairman of the board of Arkla. "After his retirement from the gas company in 1973, he handpicked his successor, Sheffield Nelson, whom he had hired as his executive assistant," according to the encyclopedia.
"But there soon followed a bitter feud, arising principally from Nelson's refusal to use Arkla's pipelines to transport gas from the Stephens family's gas wells to contract buyers farther east. The Stephens-Nelson feud lasted for the rest of the century and profoundly influenced state and even national politics."
Arkla has since become CenterPoint Energy. Nelson has run for governor of Arkansas unsuccessfully twice. He has also been a proponent, over the years, of raising natural gas severance taxes in Arkansas (see Daily GPI, July 25, 2012).
The encyclopedia called Stephens "...the most influential business leader in Arkansas for 30 years after World War II..."