Exclusive-Southwest Gas nears Questar deal after Buffett lost out-sources

0
56
imageStock Markets3 hours ago (Oct 03, 2021 17:45)

© Reuters.

By David French

(Reuters) – Southwest Gas Holdings is in advanced talks to acquire Questar Pipeline Company, a gas transportation and storage business of Dominion Energy Inc that Warren Buffett tried to buy, people familiar with the matter said on Sunday.

The deal would come three months after Dominion and the energy arm of Buffett’s Berkshire Hathaway (NYSE:BRKa) Inc abandoned their Questar deal on concerns that antitrust regulators would not approve it. Dominion then launched an auction process to divest Questar.

Southwest Gas, a gas distribution company that serves Arizona, California and Nevada, will pay close to $2 billion, including debt, for Questar, whose pipeline and storage network spans Colorado, Utah and Wyoming, the sources said.

That would be an improvement on the deal with Berkshire Hathaway, which had agreed to pay $1.3 billion in cash for Questar and assume $430 million in debt. If the negotiations conclude successfully, Dominion could announce a deal with Southwest Gas as early as this week, the sources said.

The sources requested anonymity because the matter is confidential. Dominion and Southwest Gas did not respond to requests for comment.

Questar moves natural gas through 1,867 miles (3,005 km) of pipeline, with connections to other pipeline systems in the West and Midwest United States. It also owns the Clay Basin storage facility, the largest underground storage reservoir in the Rocky Mountains, according to its website.

Dominion announced in July 2020 that it would sell its entire gas infrastructure business to Berkshire Hathaway’s energy arm for $9.7 billion including debt. While a deal for most of the assets was completed in November 2020, Questar was left out as the Federal Trade Commission scrutinized the acquisition. The companies abandoned the Questar deal in July this year, citing uncertainty over its regulatory approval.

For Southwest Gas, the acquisition would mark a northward expansion of its natural gas operations and boost its regulated operations, which supply steady cash flow and are preferred by utility investors. It also owns Centuri, a company which services pipelines.

Exclusive-Southwest Gas nears Questar deal after Buffett lost out-sources

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

LEAVE A REPLY

Please enter your comment!
Please enter your name here