Duke Energy will buy Piedmont Natural Gas in a $4.9billion deal as it looks to expand its natural gas distribution business.
The company offered $60 in cash for each Piedmont share representing a premium of around 42%.
Duke and Piedmont are also among the partners in the $5 billion 550-mile Atlantic Coast pipeline, which moves gas from Pennsylvania’s Marcellus shale field to North Carolina and Virginia.
AGL resources also has a 5 percent stake in the pipeline.
Duke sells power to 7.3 million customers in North and South Carolina, Florida, Indiana, Ohio and Kentucky at rates set by state regulators.
The company also provides regulated natgas services to about 500,000 customers in Ohio and Kentucky.
Piedmont has about one million customers in North and South Carolina and Tennessee.
Duke will also assume about $1.8 billion of Piedmont’s net debt, giving the deal an enterprise value of $6.7 billion.
One Piedmont director will join Duke’s board after the deal closes, expected by the end of 2016, and a Piedmont executive will lead Duke’s natural gas operations, the company said.