Calgary energy firm to buy Australian asset for $1B
WAGN is the right company in the right geography: ATCO CEO
CALGARY—ATCO is planning to acquire Western Australia Gas Networks (WAGN) for $1 billion.
Calgary-based ATCO Group is a utilities, energy, logistics, infrastructure and technologies firm headquarted in Calgary. It has more than 7,700 employees and assets of approximately $10 billion.
WAGN, owned by WestNet Infrastructure Group, is a natural gas distribution utility with more than12,800 km of natural gas pipelines and associated infrastructure across Australia.
ATCO plans to make the asset a subsidiary of Canadian Utilities, which is an ATCO company.
“In April 2010, our Board of Directors approved an Australian growth strategy modeled after ATCO’s existing Canadian enterprise of diverse yet complementary businesses,” said Nancy Southern, President & Chief Executive Officer, ATCO Group.
“The acquisition of Western Australia Gas Networks is an important step towards achieving this strategy. Driven by natural resource development, the utility is situated in the heart of one of the fastest growing economies in the world and complements our existing portfolio of energy infrastructure assets in Australia.”
The purchase price of $1 billion includes approximately $644 million of debt. The balance of the aggregate purchase price will be funded with existing cash reserves.
The deal is subject to approval from the Australian Foreign Investment Review Board, certain former holders of exchangeable preference shares of WestNet Infrastructure Group, and other customary conditions.
The proposed acquisition is expected to close in the third quarter of 2011.