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Columbia Extends Deadline a Week for CNG Bid

Columbia Extends Deadline a Week for CNG Bid

Columbia Energy Group said yesterday it is extending the deadline by seven days to May 10 on its merger proposal with Consolidated Natural Gas in response to a data request from CNG's board. CNG asked for additional information on a two-way collar mechanism in Columbia's unsolicited $6.7 billion bid for the company (see Daily GPI, April 20).

Columbia announced on April 18 it is was renewing its offer for CNG after having been rebuffed in February. CNG already has filed all the necessary regulatory submissions for a merger with Virginia Power parent company Dominion Resources, but Columbia claims its offer has a higher value than Dominion's all-stock transaction.

Dominion offered 1.52 shares of its stock for each share of CNG's common stock, which as of the close of trading yesterday would value the transaction at about $63.27/share or $6.1 billion. That compares with Columbia's proposal of $45.50 of cash and $24.50 of shares of Columbia common stock for each CNG share, or about $70/share. Columbia would issue whatever number of shares of its common stock would be required to equal $24.50 within set ceiling and floor prices. Both Columbia and Dominion also would have to assume about $2 billion in CNG debt.

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