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PP&L Resources Acquires Penn Fuel Gas Operations

PP&L Resources Acquires Penn Fuel Gas Operations

PP&ampL Resources Inc. announced that it acquired Penn Fuel Gas, a gas distributor and storage company, in a stock transaction valued at $133 million. The purchase was the latest step by the utility company to diversify its portfolio of energy products and services, said PP&ampL Resources President William F. Hecht.

Penn Fuel Gas, which is based in Oxford, PA, owns PFG Gas Inc. and North Penn Gas Co., both gas distributors, and also operates a propane business. In addition, North Penn Gas owns natural gas storage facilities in Pennsylvania. The company has 100,000 gas customers in Pennsylvania and in a small part of Maryland.

Under the deal, Penn Fuel Gas will retain its name and will operate as a wholly owned subsidiary of PP&ampL Resources, parent of PP&ampL. PP&ampL, headquartered in Allentown, PA, provides electricity services to 1.2 million homes and businesses in the state.

The terms of the merger agreement called for shareholders of Penn Fuel Gas to receive 6.968 common shares of PP&ampL Resources for each common share of Penn Fuel Gas that they owned. PP&ampL issued about $133 million of common stock to close the merger.

"Through the acquisition of Penn Fuel Gas, we'll have the transportation services to supply gas. Expanding into the natural gas business with a quality operation like Penn Fuel Gas is a tremendous opportunity," Hecht noted.

Susan Parker

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