Southern Union Co. has completed a previously announced transaction that has increased its ownership interest in Florida Gas Transmission and resulted in the transfer of its ownership position in Transwestern Pipeline to Energy Transfer Partners, LP.
Southern Union redeemed Energy Transfer Partners' 50% interest in CCE Holdings LLC (CCEH) for 100% of the equity interests in Transwestern Pipeline Company LLC. Energy Transfer paid about $1.4 billion.
"Completing this transaction further illustrates the ongoing transformation of the company's asset portfolio to create long-term value for our shareholders," said Southern Union CEO George L. Lindemann (see Daily GPI, Sept. 18).
Eric D. Herschmann, senior executive vice president of Southern Union, added, "The closing of this transaction increases our investment in Florida Gas and strengthens the company's strategic position in the growing Florida market."
With the closing of the transaction, Southern Union owns 100% of CCEH, which was formed in 2004 to purchase CrossCountry Energy from Enron Corp. and its affiliates, and 50% of Citrus Corp, which is the holding company for Florida Gas Transmission. The remaining 50% of Citrus Corp. is owned by an affiliate of El Paso Corp. In conjunction with the transaction, Southern Union repaid $455 million of indebtedness at Transwestern Holding Co. LLC, utilizing the proceeds from an unsecured term loan facility issued at Trunkline LNG Holdings LLC, an indirect wholly owned subsidiary of the company.
Southern Union, headquartered in Houston, owns and operates the nation's second largest natural gas pipeline system with more than 20,000 miles of gathering and transportation pipelines and North America's largest liquefied natural gas import terminal at Lake Charles, LA.
Through Panhandle Energy, Southern Union's interstate pipeline interests operate more than 15,000 miles of interstate pipelines that transport natural gas from the Anadarko and San Juan basins, the Rockies, the Gulf of Mexico, Mobile Bay and South Texas to major markets in the Southeast, Midwest and Great Lakes region.
Southern Union Gas Services, with approximately 4,800 miles of pipelines, is engaged in the gathering, transmission, treating, processing and redelivery of natural gas and natural gas liquids in Texas and New Mexico.
Through its local distribution companies, Missouri Gas Energy and New England Gas Co., Southern Union also serves approximately half a million natural gas end-users in Missouri and Massachusetts.
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