Southwestern Energy Co. has sold its gas distribution business, Arkansas Western Gas Co., to SourceGas LLC, an affiliate of GE Energy Financial Services and Alinda Investments LLC for $224 million plus working capital.
The transaction is subject to certain closing conditions and regulatory approvals and is expected to close by mid-2008. Arkansas Western Gas serves approximately 151,000 residential, commercial and industrial customers in northern Arkansas. It owns more than 5,700 miles of gathering, distribution and transmission pipelines, an underground storage facility and related gas distribution assets and has approximately 375 employees.
“We believe that this is the right direction for Southwestern Energy and its shareholders,” said Southwestern CEO Harold M. Korell.
“In line with our strategy to expand existing operations and grow through acquisitions, this purchase is the first significant expansion of our service footprint and an important step to providing SourceGas quality to more consumers,” said SourceGas CEO Dan Watson. “We expect the acquisition and ensuing transition to be seamless to customers…”
SourceGas is a local distribution company headquartered in Lakewood, CO, with operations in Colorado, Nebraska, Wyoming and Hermosillo, Mexico. It serves more than 266,000 customers and operates 12,000 miles of distribution and transmission pipelines, as well as storage facilities.
Southwestern had said back in 2000 that it would sell the gas distribution business (see Daily GPI, Aug. 14, 2000).
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