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KeySpan, LILCO Finish Merger

KeySpan, LILCO Finish Merger

KeySpan Energy Corp. combined last week with Long Island Lighting Co. (LILCO) to form MarketSpan Corp., a new holding company dedicated to market growth in the Northeast as well as investments in energy in North America and abroad.

KeySpan and LILCO trading on the New York Stock Exchange will be replaced by MarketSpan at the opening bell today. Shareholders of LILCO will receive 0.880 shares of MarketSpan common stock for each share of LILCO, and KeySpan shareholders will receive one share of MarketSpan common stock for each share of KeySpan. "The merger consummated today provides customers from Staten Island to Montauk Point with reduced energy costs and enhanced services," said William J. Catacosinos, CEO of MarketSpan.

Headquartered in both Brooklyn and Hicksville, MarketSpan owns LILCO's common plant, non-nuclear electric-generation assets and operations, and the regulated natural gas businesses of both LILCO and Brooklyn Union. In addition, MarketSpan owns KeySpan's unregulated subsidiaries and its investments in gas exploration, production and transportation - including a 66% ownership in Houston Exploration Co. The KeySpan unregulated subsidiaries will retain their names. Brooklyn Union will continue to serve customers in Brooklyn, Queens, and Staten Island. A separate MarketSpan subsidiary will provide gas service to Long Island also under the Brooklyn Union name.

In conjunction with the sale of some of LILCO's electric assets to the Long Island Power Authority, LIPA became the authority providing electric service on Long Island.

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