N.C. Regulators OK Duke's Purchase of Piedmont
The North Carolina Utilities Commission has approved Duke Energy's $6.7 billion purchase of Piedmont Natural Gas - the final approval needed for the merger. The companies said Thursday they expect to close the deal on Monday, Oct. 3.
Duke, the nation's largest utility, announced the acquisition 11 months ago, and it won federal approval in December. The utilities commission agreed in January to speed up its approval process, and held a public hearing in July.
The commission's public staff had recommended approval after the Duke and Piedmont agreed to concessions. They included promises of charitable donations ($17.5 million a year for four years), another $7.5 million for energy assistance programs, and small rate reductions for gas and electric companies.
On Thursday, Duke CEO Lynn Good repeated what the company said last year, that the purchase would help Duke expand its gas and pipeline businesses.
"This combination provides clear benefits to our customers and the environment as we continue to expand our use of low-cost and clean natural gas and invest in pipelines," Good said in a statement. "We have enjoyed an excellent relationship with Piedmont’s team for years, and we are eager to welcome them to Duke Energy in the coming days.”
As Duke closes coal-fired plants and shifts much of its electricity production to natural gas, it's already Piedmont's largest customer.
And the two companies are partners in the Atlantic Coast Pipeline, which will bring natural gas to North Carolina from fracking wells in Ohio, Pennsylvania and West Virginia.
Duke has said the merger won't bring any layoffs, since the two companies' businesses don't overlap. Piedmont will keep its name and operate as a subsidiary of Duke Energy.
Piedmont CEO Thomas Skains plans to retire, but he'll join Duke's board of directors.
The deal adds Piedmont’s 1 million natural gas customers in the Carolinas and Tennessee to Duke's existing 525,000 natural gas customers and 7.4 million electric customers in the Southeast and Midwest.
Duke Energy is paying $4.9 billion in cash and assuming about $1.8 billion of Piedmont debt.
Analysts say electric utility acquisitions of gas companies are a trend, in part because of slow growth in the electric business. A few months before the Duke-Piedmont deal was announced, Atlanta’s Southern Co. unveiled a $12 billion deal to buy gas company AGL Resources. That deal closed on July 1.