John Matthews
WMAL.com
WASHINGTON — (WMAL) WGL Holdings, the parent company of Washington Gas, has agreed to be purchased by Calgary-based AltaGas, in a cash deal valued at $6.4 billion.
Washington Gas would become the second area utility in the past year to be purchased by a larger company. In 2016, Pepco Holdings was snapped up by Elelon in a $6.8 billion deal that was nearly undone multiple times by regulatory challenges. The Washington Gas/AltaGas deal will also be subject to regulatory approval.
As part of the merger, AltaGas says it will move its U.S. headquarters to the current Washington Gas offices on Constitution Avenue. AltaGas has gas distribution businesses in Michigan and Alaska, as well as power plants in California, which add up to about 50 percent of the company’s assets.
As a mid-size natural gas utility, Washington Gas has become an attractive target for larger companies looking to diversify in recent years. Since the advent of fracking, the U.S. has become an exporter of natural gas, a turnaround that has sparked great interest among investors in the utility sector
If all goes well, both companies hope to close the deal by the end of 2017.
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