US-based natural gas utility company Chesapeake Utilities is set to acquire a Florida gas utility from NextEra Energy for $923m (€874m), expanding its footprint in the state.
NYSE-listed clean energy firm NextEra Energy said its electric utility arm Florida Power & Light Company (FPL) has agreed to sell Florida City Gas (FCG) for $923m, including $145m of intercompany debt.
FCG serves about 120,000 residential and commercial natural gas customers across eight counties in Florida, including Miami-Dade, Broward, Brevard, Palm Beach, Hendry, Martin, St Lucie and Indian River.
FCG’s natural gas system includes approximately 3,800 miles of distribution main and 80 miles of transmission pipe.
Jeff Householder, chairman, president and CEO of Chesapeake Utilities, said the acquisition will more than double Chesapeake’s natural gas business in Florida.
Householder added: “We have generated meaningful earnings growth by acquiring businesses in states where we already operate and subsequently developing and executing additional growth opportunities.
“We see similar opportunities with FCG, and believe we are well positioned to capture additional growth including gas distribution expansion to serve new residential development, as well as infrastructure investments across our other platforms, such as gas transmission.”
Beth Cooper, EVP, CFO, treasurer and assistant corporate secretary of Chesapeake Utilities, said the deal is expected to be financed through a combination of long-term debt and equity, “ensuring we maintain a strong balance sheet while supporting our long-term earnings and dividend growth”.
John Ketchum, chairman, president and CEO at NextEra Energy said the transaction “allows us to continue our strategy of redeploying capital into our core businesses”.
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