Dominion Energy Inc. will buy Scana Corp. for $7.9 billion in a stock-for-stock deal, scooping up a utility battered by a failed nuclear project that’s drawn scrutiny from federal and state regulators.
The transaction is valued at about $14.6 billion including the assumption of debt, according to a statement Wednesday. Scana shareholders will receive 0.669 shares of Dominion for each share of Scana, equal to about $55.35 a share. The acquisition is expected to close in 2018 pending regulatory and shareholder approval, according to the statement.
Scana made an attractive target as the company’s market value plummeted after the utility halted a controversial nuclear expansion in late July. Federal and state investigators are probing the project, which triggered a review of the law that allows utilities to charge customers for unfinished or abandoned power plant projects.
“Dominion acquiring Scana makes a lot of sense,” Shahriar Pourreza, a New York-based analyst for Guggenheim Securities LLC, said by phone Wednesday. Dominion is building a major natural gas pipeline, the Atlantic Coast line, to the South Carolina border, and state officials want it extended, he said. The line could serve Scana customers.
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SOURCE: Bloomberg, Christine Buurma and Jim Polson