Nicor Inc. (NYSE: GAS) got the merger that was speculated about in the market, as it was just last Thursday that shares spiked to $47 from $43 in minutes. AGL Resources (NYSE: AGL) is acquiring Nicor in a transaction with an enterprise value of $3.1 billion, including a total equity value of $2.4 billion.
Nicor shareholders will receive cash and stock valued at $53.00 per share and the company will have some 4.5 million distribution customers. After the merger is complete, AGL holders will hold 67% of the combined NewCo. The enterprise value of the combined entity will be approximately $8.6 billion. AGL Resources further noted that it expects to become a Fortune 500 company.
The combined company is expected to have approximately $5.1 billion in annual revenues and EBITDA of $1.1 billion. It will hold seven regulated natural gas distribution companies providing natural gas service to approximately 4.5 million customers in Illinois, Georgia, New Jersey, Virginia, Florida, Tennessee and Maryland, with a rate base of $3.8 billion. It is also going to have more than 1 million retail customers in the unregulated businesses.
Nicor shareholders will be entitled to receive for each share of Nicor common stock, $21.20 in cash and 0.8382 shares of AGL Resources common stock. As far as whether or not a higher price may come to Nicor holders, keep in mind that this is effectively an all-time high.
Nicor’s pre-adjusted value at this $53.00 comes to what appears to be an all-time high. The problem is that the stock component can influence that ‘all time high’ status and that seems to be what we are seeing. Nicor shares are up 5.9% at $49.50 versus a 52-week range of $37.99 to $48.47. AGL Resources is down about 3.2% at $35.95 and its 52-week trading range is $34.26 to $40.08.
JON C. OGG
100 Million Americans Are Missing This Crucial Retirement Tool
The thought of burdening your family with a financial disaster is most Americans’ nightmare. However, recent studies show that over 100 million Americans still don’t have proper life insurance in the event they pass away.
Life insurance can bring peace of mind – ensuring your loved ones are safeguarded against unforeseen expenses and debts. With premiums often lower than expected and a variety of plans tailored to different life stages and health conditions, securing a policy is more accessible than ever.
A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family’s needs. Life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.
Click here to learn how to get a quote in just a few minutes.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.