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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