From staff reports
Southern Company, the parent company of Alabama Power, is in talks to acquire AGL Resources in a $12 billion deal, according to Michael Tomberlin of Alabama News Center.
The deal would create the country’s leading electric and natural gas utility company if finalized, and would give southern company ownership of AGL.
AGL owns a liquefied natural gas facility in Trussville, and delivers about 60,000 gallons per day to merchants. This deal, however, would create a new electric and natural gas utility by placing AGL under the Southern Company umbrella, and would service nearly 9 million customers across nine states.
“As America’s leader in developing the full portfolio of energy resources, we believe the addition of AGL Resources to our business will better position Southern Company to play offense in supporting America’s energy future through additional natural gas infrastructure,” Southern Company CEO Thomas A. Fanning told Tomberlin. “For some time, we have expressed our desire to explore opportunities to participate in natural gas infrastructure development.”
AGL shareholders will receive $66 in cash for each share of common stock held in the company under the current agreement. Shareholders would also receive a 36.3 percent increase in this month’s average trading price. Southern Company says it expects and increase in earnings the first year after the acquisition is finalized.
“AGL Resources’ management team and board of directors wholeheartedly support this transaction, and we believe it will provide new opportunities and enhanced value for our shareholders, customers and employees,” AGL Resources CEO John W. Somerhalder II told Tomberlin. “Importantly, both companies are committed to safely delivering clean, reliable, affordable energy while providing customers with world-class service. The respective models of Southern Company and AGL Resources focus on the fundamental values of safety, operational excellence and environmental stewardship.
“We’ve found a strong partner in Southern Company with its complementary businesses, excellent reputation and shared values,” he said. “They have committed to continuing our tradition of community and philanthropic support and exceptional service to customers. We look forward to working with Southern Company to complete the transaction as expeditiously as possible and ensure a smooth transition.”
AGL does not anticipate any changes to their production or any plants following the acquisition.
“AGL Resources remains committed to operating our LNG facilities, which are ranked number one in storage in the United States,” a spokesperson from AGL said. “As a lower cost alternative to fuels like diesel and propane, LNG offers significant long-term benefits for the environment and growth.”
The local AGL plant is located off Floyd Bradford Road in Trussville.