Dominion Buys Gas Co.
RICHMOND, Va. (AP) _ Dominion Resources Inc. is buying Louis Dreyfus Natural Gas Corp. for $1.8 billion in cash and stock in a deal that will increase its natural gas reserves by 60 percent.
The deal announced Monday also calls for Richmond-based Dominion to assume $505 million in Louis Dreyfus debt.
Louis Dreyfus, based in Oklahoma City, is an independent natural gas production and exploration company operating primarily in Texas and the Gulf of Mexico.
Dominion has about 4 million customers in the mid-Atlantic, Midwest and Northeast.
The acquisition will boost Dominion’s natural gas reserves to 4.6 trillion cubic feet. It also will allow the company’s exploration and production unit to produce more than 450 billion cubic feet annually, an increase of more than 40 percent.
Dominion, which also has a 22,000-megawatt electric generation portfolio, will have daily energy production capability of more than 3 billion British thermal units after the purchase is completed.
``The acquisition of Louis Dreyfus Natural Gas is a natural fit _ economically, strategically and geographically,″ said Thomas E. Capps, Dominion’s president and chief executive officer.
Each Louis Dreyfus shareholder will receive $20 in cash and 0.3226 shares of Dominion common stock for each share of Louis Dreyfus Natural Gas common stock.
At Friday’s closing price for Dominion stock, that would value Louis Dreyfus at $40.20 a share, or 22 percent more than its late price of $32.96 on the New York Stock Exchange.
Mark E. Monroe, president and chief executive officer of Oklahoma City-based Louis Dreyfus, said the transaction ``benefits our shareholders by providing an attractive near-term return and opportunity to participate with a larger company involved in more facets of the energy business.″
On the Net:
Dominion site: http://www.dom.com
Louis Dreyfus site: http://www.ldng.com