Energy America pulled off a last minute coup in last Wednesday’sauction for bankrupt Georgia retail marketer Titan Energy’s gascustomers by outbidding Shell Energy Services with a price of $2.5million for 50,000 gas buyers. Energy America paid $44/customer, adollar more than Shell, plus the $7 per customer switching fee.
“We are pleased to welcome Titan customers into the EnergyAmerica family and are committed to providing them with the samelow-cost natural gas and superior service that our currentcustomers receive,” said David Zeitz, president of Energy America,a joint venture between Sempra Energy and Direct Energy Marketing.Zeitz assured Titan’s customers that it would be a seamlesstransition with no disruption of supply.
Formerly the fifth-largest marketer in Georgia, the acquisitionbrings Energy America’s total customer base to more than 120,000residential and small-business customers, making it the state’sfourth-largest marketer.
Shell had been in advanced negotiations with Titan for thecustomers until Bankruptcy Court Judge W. Homer Drake determinedthat an auction was the most impartial way of deciding the fate ofthe customers. Shell also posted the second highest bid, accordingto Atlanta Gas Light spokesman Nick Gold. “Shell was initiallyoffering $35 for each customer and went as high as $43. Theywithdrew when Energy America entered their bid of $44. So it wasreally a match between those two shooters. They were really goingat it.”
Beginning early next week, Energy America will formally notifyformer Titan customers of the change in their energy serviceproviders.
Titan Energy filed for Chapter 11 over the Fourth of Julyweekend after its wholesale natural gas supplier, DukeSolutions,filed a lawsuit against the Roswell, GA, marketer in federal courtin Houston, accusing it of breach of contract. DukeSolutions, asubsidiary of Duke Energy, contends Titan Energy owes it more than$10 million. Titan became the second marketer to seek bankruptcyprotection in Georgia in less than a year.
Titan still owes AGL about $1.6 million for back distributioncharges. It paid part of its $2.8 million AGL bill with a letter ofcredit last week but still owes the balance.
Titan Energy’s case closely parallels that of Peachtree NaturalGas, which last year became the first marketer serving thederegulated Georgia natural gas market to file for bankruptcy. Inthat case, Peachtree sold its 170,000 customers to Shell Energy for$19.3 million.
Based in Stamford, CT with offices in Georgia, Energy America isa joint venture between Sempra and Direct Energy, Canada’s largestindependent natural gas marketing company. Energy America currentlysells electricity and natural gas to 400,000 residential andsmall-business customers in New Jersey, Georgia, Maryland, Ohio,Pennsylvania and Michigan.
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