The proposed marriage of KN Energy Inc. and Kinder Morgan Inc.has passed federal antitrust review and has been verbally approvedby Colorado regulators, which puts the deal on track to becompleted in the early fourth quarter, the companies said.

“Meeting the Hart-Scott-Rodino [Antitrust] Act requirementssatisfies an important condition to the closing of thistransaction,” said Richard D. Kinder, chairman and CEO of KinderMorgan. “We are aggressively pursuing other necessary approvals,and we believe we are on track to close the merger concurrent withthe shareholders’ vote [on Sept. 28] or shortly thereafter.”Kinder, who had been a board member of KN Energy until just priorto the announcement of the merger, will be chairman and CEO of themerged company, which will be known as Kinder Morgan Inc.

While it assented to the transaction verbally, the ColoradoPublic Utilities Commission isn’t expected to issue a written orderapproving the merger until either later this month or in earlySeptember. The merger also needs clearances from the CaliforniaPublic Utilities Commission, FERC and the Securities and ExchangeCommission.

Both KN Energy and Kinder Morgan have scheduled concurrentspecial meetings on Sept. 28 in Denver and Houston, respectively,for shareholders to vote on the proposed merger. At KN’s meeting,shareholders will vote to issue 41.5 million shares of companystock in return for all of the outstanding shares of Kinder Morgan.They also will vote to amend KN’s articles of incorporation tochange the corporate name of the company to Kinder Morgan Inc. uponcompletion of the merger.

The announcement of a KN Energy-Kinder Morgan deal came in earlyJuly – less than three weeks after KN’s proposed $6 billion mergerwith Sempra Energy collapsed. The new alliance – assuming all thenecessary regulatory approvals come through – would create amassive midstream energy company with 30,000 miles of gas,petroleum products and liquids pipelines, and an enterprise valueof $8.5 billion.

Houston-based Kinder Morgan is a private company and solestockholder of the general partner of Kinder Morgan Energy PartnersL.P., which is the nation’s largest pipeline master limitedpartnership with an enterprise value of about $3 billion. It ownsand operates one of the largest product pipeline systems in theUnited States, with more than 5,000 miles of pipeline and more than20 associated terminals. It also operates 24 bulk terminalfacilities for coal, petroleum coke and other products.

KN Energy, based in Lakewood, CO, is the sixth largestintegrated natural gas company in the nation, with more than $8billion in total assets and is one of the largest pipelineoperators with more than 25,000 miles of pipe, most notably NaturalGas Pipeline Co.’s system.

Susan Parker

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