Energen To Sell Alabama Gas Corp. To Laclede Group For $1.6 Bln - Quick Facts

(RTTNews) - Oil and gas company Energen Corp. (EGN) has reached a definitive stock purchase deal to sell its natural gas utility business, Alabama Gas Corporation (Alagasco), to The Laclede Group, Inc. (LG) for $1.6 billion. The deal value includes $1.28 billion in cash and nearly $320 million of debt. After consideration of accelerated intangible drilling costs, Energen's after-tax proceeds are projected to be $1.1 billion.

Founded in 1857 as The Laclede Gas Light Co., Laclede Group's gas utility segment serves St. Louis and eastern Missouri through Laclede Gas and Kansas City and western Missouri through Missouri Gas Energy.

Energen intends to use cash proceeds to immediately reduce short-term indebtedness, thereby improving its financial capacity to potentially accelerate the pace of drilling and development of its Permian Basin assets in 2015 and beyond. Energen would remain a Birmingham-based company and plans to continue its strong tradition of civic and community involvement.

On the other hand, Laclede expects the purchase to be strongly accretive to net economic earnings per share in the first full year. Subject to state and federal regulatory approval, the deal may be complete in 2014.

J.P. Morgan Chase & Co. is acting as financial advisor to Energen, and Bradley Arant Boult Cummings LLP is acting as legal counsel.