Virginia State Corporation Commission Approves Combination of AltaGas and WGL Holdings

Virginia joins FERC, the Federal Trade Commission, the Department of Justice, and CFIUS in approving the combination

Today the Virginia State Corporation Commission (VSCC) approved the combination of AltaGas and WGL Holdings.

AltaGas and WGL Holdings are pleased with the decision made today by the VSCC, which approved the combination subject to conditions supported by AltaGas and WGL. The approval and support of the Virginia State Corporation Commission for the combination is a key milestone in the regulatory approval process for AltaGas and WGL.

AltaGas and WGL are confident of the benefits of this proposed combination, as the benefits are based on the strong foundation of providing value for Washington Gas customers in the region. The combined company will be in an even stronger position to deliver exceptional service at affordable rates, more investment in the community and workforce training programs, as well as good secure jobs. The combination will better position WGL to deliver more clean energy options to customers and the community in the future.

Today’s approval follows the completion of the federal review process. These include;

  • Approval from the Federal Energy Regulatory Commission (FERC), on July 6, 2017, an independent agency that regulates the interstate transmission of natural gas, electricity and oil;
  • Expiration of the waiting period as of July 17, 2017, pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act), when the merger was deemed approved by the Federal Trade Commission and the Department of Justice, and;
  • Approval from the Committee on Foreign Investment in the United States (CFIUS) on July 28, 2017.

The regulatory review process continues in Maryland and the District of Columbia. AltaGas and WGL continue to work constructively with the regulatory commissions and the parties involved in the regulatory proceedings in Maryland and the District of Columbia to make sure all consumers benefit, existing jobs are protected, new jobs are added, and our support for clean energy is moved forward. Final decisions are expected on the combination in December in Maryland, and in the first half of 2018 in the District of Columbia.

CEOs of AltaGas Ltd. and WGL Holdings, Inc. testify before Maryland Public Service Commission on benefits to combining the two companies

On October 3, 2017, the CEOs of AltaGas Ltd. and WGL Holdings, Inc., David Harris and Terry McCallister, testified before the Maryland Public Service Commission on the benefits to combining the two companies. 

The Commission held two-and-a-half weeks of evidentiary hearings as part of the ongoing regulatory review process of the proposed combination of the two leading energy companies. The companies demonstrated over the course of the hearings that AltaGas brings an excellent track record of strong financial and operational performance to Maryland, that together the companies will be even better positioned to deliver more diverse energy solutions to customers, and finally, that customers and communities will benefit from an array of new investments and commitments. 

AltaGas is a financially strong, well-managed company with a solid existing base business and a successful track record of growth over the last 23 years. The company’s highly contracted, low-risk business model continues to deliver strong, stable returns to investors and exceptional service to its customers. AltaGas, through its wholly owned subsidiaries, provides utility service to 575,000 customers in the U.S. and Canada, including 450,000 in the U.S.

AltaGas and WGL Holdings are confident of the benefits of this proposed combination, as they are built upon the strong foundation of providing value for Washington Gas customers in Maryland. The combined company will be in an even stronger position to deliver exceptional service at affordable rates, more investment in the community and workforce training programs, as well as good secure jobs. The combination will better position Washington Gas to deliver more clean energy options to customers and the community in the future. Following regulatory approval, there will be no rate increase as a result of the combination.

Here are just some of the ways MD consumers will benefit from the merger:

  • No layoffs are planned as a part of this combination.
  • AltaGas intends to retain existing Washington Gas executives to assist in managing AltaGas’ U.S. regulated utility business.
  • AltaGas will fund $30.5 million for one-time bill credits to be distributed among all Maryland customer classes.
  • AltaGas will provide $4.0 million to develop and fund an Affordable Housing Multifamily Natural Gas Initiative for Maryland.
  • The combined company will enhance our local presence post-Merger with the relocation of the head office of the AltaGas U.S. power business to the Greater Washington, D.C. metropolitan area.
  • AltaGas will protect Washington Gas employees’ pay, benefits, job security, retirement, and pensions.
  • Washington Gas will have the same complement of dedicated employees to deliver safe and reliable service.
  • Customers will experience a seamless transition, with continued, safe and reliable service. 
  • Washington Gas will significantly increase the Washington Area Fuel Fund over the next 5 years, providing emergency utility bill assistance to qualifying low and moderate income customers. 
  • Washington Gas will continue offering assistance to low income customers including weatherization and installation of energy efficient technology.
  • Following regulatory approval, the combined company will significantly increase charitable contributions, invest even more in workforce training programs, and help make clean energy more affordable for our customers.

The companies have filed extensive testimony with the Commission to demonstrate the benefits of combining the two companies.

Below are two excerpts from the testimony of Mr. Harris and Mr. McCallister filed with the Maryland Public Service Commission on April 24, 2017.

From David Harris:

“AltaGas and WGL are committed to the communities where Washington Gas provides service. The combined company intends to enhance our local presence post-Merger with the relocation of the head office of the AltaGas U.S. power business to the Greater Washington, D.C. metropolitan area. The Merger will enhance the combined company’s commitments to the existing community in which Washington Gas operates, and Washington Gas will continue its relationships with its local communities. 

“I am confident that the Merger will strengthen Washington Gas and its continued ability to provide safe and reliable service to its customers. The Merger maintains the value propositions espoused by Washington Gas, its service commitments to customers, and the continued commitment to the communities in which it serves. Washington Gas will continue to provide safe and reliable service to its customers at affordable rates. And AltaGas will ensure that Washington Gas continues to have access to the capital resources needed to invest in the safety and reliability of its system.”

From Terry McCallister:

“For WGL and for the Washington, D.C. region, this Merger brings a new business to the area while retaining existing businesses. The Merger keeps the Washington, D.C. region at the center of WGL’s existing businesses, and retains and supports WGL’s own growth plans.

“WGL’s charitable, community, and local supplier presence will continue in the Washington, D.C. area. AltaGas is committed to continuing and increasing charitable giving in the region. It is dedicated to building on the strong community commitment and presence of WGL, Washington Gas and its employees. It will also continue Washington Gas’ commitment to leadership in growth of supplier diversity efforts.”


Additional Background Information:

Both AltaGas and WGL have a tradition of investing in the communities they serve, and are committed to continuing investments in Maryland. Both companies look forward to working with community groups, local leaders and regulators to make sure the combined company remains committed to offering reliable service at affordable rates. WGL’s customer bills will not go up as a result of the combination.

Status of Regulatory Review Process

All required federal approvals are complete, including:

  • Approval from the Federal Energy Regulatory Commission (FERC), on July 6, 2017, an independent agency that regulates the interstate transmission of natural gas, electricity and oil;
  • Expiration of the waiting period as of July 17, 2017, pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act), when the combination was deemed approved by the Federal Trade Commission and the Department of Justice and;
  • Approval from the Committee on Foreign Investment in the United States (CFIUS) on July 28, 2017.

Virginia:

  • The staff to the Virginia State Corporation Commission filed a productive report on the proposed combination in August. That report and responses to the report are under consideration by the Virginia Commission, with a decision expected in late October 2017.

Maryland: 

  • Following the evidentiary hearings, the companies and other parties in the case will file briefs with the Commission. The Commission is expected to issue its decision in early December 2017. 

District of Columbia: 

  • The intervenors in the case have filed their initial testimony. AltaGas and WGL will file responses in late October. Hearings in front of the District of Columbia Public Service Commission will occur in December 2017 with a decision expected in the first half of 2018. 

AltaGas and WGL will continue to work constructively with the regulatory commissions in all three jurisdictions within WGL’s service territory to make sure all consumers benefit, existing jobs are protected, new jobs are added, and clean energy is moved forward.

To learn more about the combination, please visit www.WGLdeliveringmore.com

About AltaGas

AltaGas (TSX:ALA) is an energy infrastructure company with a focus on natural gas, power and regulated utilities. AltaGas creates value by acquiring, growing and optimizing its energy infrastructure, including a focus on clean energy sources. For more information visit: www.altagas.ca

About Washington Gas

Washington Gas Light Company is a regulated natural gas utility providing safe, reliable natural gas service to more than 1.1 million customers in the District of Columbia, Maryland and Virginia. A subsidiary of WGL Holdings, Inc., the company has been providing energy to residential, commercial and industrial customers for 169 years.

About WGL

WGL (NYSE: WGL), headquartered in Washington, D.C., is a leading source for clean, efficient and diverse energy solutions. With activities and assets across the U.S., WGL consists of Washington Gas, WGL Energy, WGL Midstream and Hampshire Gas. WGL provides options for natural gas, electricity, green power and energy services, including generation, storage, transportation, distribution, supply and efficiency. Our calling as a company is to make energy surprisingly easy for our employees, our community and all our customers. Whether you are a homeowner or renter, small business or multinational corporation, state and local or federal agency, WGL is here to provide Energy Answers. Ask Us. For more information, visit us at www.wgl.com

Federal Reviews of AltaGas Ltd. and WGL Holdings, Inc. Merger Are Complete

All required federal reviews of the proposed merger of AltaGas Ltd. and WGL Holdings, Inc. have been completed and clear the way for the companies to combine operations, pending the outcomes of regulatory proceedings in Maryland, Virginia and the District of Columbia.

The Committee on Foreign Investment in the United States (CFIUS) was the final of three federal reviews needed by the companies. After reviewing the details of the merger, CFIUS staff determined that “there are no unresolved national security concerns with respect to the above transaction.” 

On July 6, 2017 AltaGas and WGL received approval from the Federal Energy Regulatory Commission (FERC), an independent agency that regulates the interstate transmission of natural gas, electricity and oil.

The third necessary federal approval occurred July 17, 2017, when the merger was deemed approved by the Federal Trade Commission and the Department of Justice upon the expiration of the waiting period required by Section 7A(b)(1) of the Clayton Act, 15 U.S.C. Section 18a(b)(1) (Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended).

Regulatory reviews continue in Maryland, Virginia and the District of Columbia

While the federal reviews are complete, AltaGas and WGL continue to work constructively with the regulatory commissions in Maryland, Virginia and the District of Columbia. Schedules have been agreed to in all three jurisdictions with final decisions expected on the merger in October in Virginia, December in Maryland, and the end of April in the District of Columbia. In Virginia, Virginia State Cooperation Commission (VSCC) staff recommended on August 4, 2017, that the VSCC approve the merger, subject to several accounting, finance and safety-related VSCC requirements.

In Maryland, the Public Service Commission has issued an order scheduling two evening hearings to receive public comment on the proposed merger. The hearings are set for September 26 in Prince George’s County and September 28 in Montgomery County. Seven intervenors in the case in Maryland have submitted their testimonies to the Public Service Commission. AltaGas and WGL are reviewing the testimonies and will file a full response to all parties on September 11, 2017, in accordance with the Maryland Public Service Commission procedures.

Community hearings in the District of Columbia are expected to be scheduled in November.

Background on the Merger

The proposed plan for AltaGas and WGL to combine operations was announced in January 2017 with an expected close date in the second quarter of 2018. The transaction is subject to closing conditions, such as approvals of the Public Service Commission of the District of Columbia, the Maryland Public Service Commission and the Virginia State Corporation Commission, based on filings submitted on April 24, 2017, to each commission.  

WGL shareholders voted to approve the proposed merger in May, and the Boards of Directors of WGL and AltaGas have unanimously approved the transaction.

Under the terms of the transaction, following the consummation of the merger, WGL shareholders will receive US $88.25 in cash per WGL share, representing a premium of 27.9 percent to WGL's closing share price on November 28, 2016, the day prior to news reports of a potential acquisition of WGL by a third party.

The combined company stands to deliver more clean energy choices, more investments in the community, and a commitment to good, secure jobs, as well as affordable prices and best-in-class service.

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AltaGas Ltd. and WGL Holdings, Inc. Receive FERC Approval to Combine Operations

The proposed merger of AltaGas Ltd. and WGL Holdings, Inc. achieved an important regulatory approval on July 6 when the Federal Energy Regulatory Commission (FERC) granted its approval of the merger.  FERC is an independent agency that regulates the interstate transmission of natural gas, electricity and oil.

AltaGas and WGL filed an application with FERC on April 24, 2017, to request authorization for the transaction.  The July 6 FERC order concluded that the proposed transaction is consistent with the public interest and is authorized.

The proposed plan to combine operations was announced in January 2017.  The FERC action is an important step toward completing the transaction, which is expected to close in the second quarter of 2018.  The combined company stands to deliver more clean energy choices, more investments in the community, and a commitment to good, secure jobs, as well as affordable prices and best-in-class service.

As previously announced, WGL shareholders voted to approve the proposed merger in May, and the Boards of Directors of WGL and AltaGas have unanimously approved the transaction.

Under the terms of the transaction, following the consummation of the merger, WGL shareholders will receive US $88.25 in cash per WGL share, representing a premium of 27.9% to WGL's closing share price on November 28, 2016, the day prior to news reports of a potential acquisition of WGL by a third party.

The transaction is subject to other closing conditions, such as approvals of the Public Service Commission of the District of Columbia, the Maryland Public Service Commission and the Virginia State Corporation Commission, based on filings submitted on April 24, 2017, to each commission.  The review of the filings is underway in all three jurisdictions. The companies also have filed their voluntary Joint Notice to the Committee on Foreign Investment in the United States.  In addition, the transaction is subject to the notification and reporting requirements under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

For more information about the proposed merger of AltaGas Ltd. And WGL Holdings Inc., please visit www.wgldeliveringmore.com.

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AltaGas Ltd. And WGL Holdings, Inc. file with Regulatory Commissions in Washington, D.C., Maryland and Virginia to Receive Approval to Combine Operations

The combined company will deliver more for people across the region. More clean energy choices, more investments in the community, a commitment to good, secure jobs—all with affordable prices and best-in-class service.

AltaGas Ltd. and WGL Holdings, Inc. filed applications today seeking regulatory approval by the Public Service Commission of the District of Columbia, the Maryland Public Service Commission and the Virginia State Corporation Commission to combine their operations. The companies announced their plan to combine on January 25, 2017.

AltaGas and WGL have also filed their voluntary Joint Notice to the Committee on Foreign Investments in the United States, and an application with the Federal Energy Regulatory Commission. The transaction is also subject to the notification and reporting requirements under the Hart-Scott-Rodino Act, and other customary closing conditions.

“We have a tremendous opportunity ahead of us to combine two leading companies with a complementary set of energy businesses to deliver value to customers at affordable prices,” said David Harris, President and CEO of AltaGas. “Together we will deliver cleaner energy choices, increased investment in the community and good secure jobs for people living and working in the region.”

“WGL is proud of its 170-year record of providing superior service to the region,” said Terry McCallister, Chairman and CEO of WGL. “We’re excited to join with AltaGas because this combination will deliver even more value to our customers, while keeping rates affordable, and promoting job creation and cleaner energy choices.”

Links to the filed applications can be viewed at: 

Frequently Asked Questions

The combined company will deliver more for people across the region: more clean energy choices, more investment in the community, and a commitment to good, secure jobs – all with affordable prices and service you can count on.

Q: Why areAltaGas and Washington Gas combining?

A: AltaGas and Washington Gas share a vision for more growth and jobs in the region, more clean energy choices, and the continued reliable service you can count on. Washington Gas is a proven provider of safe, reliable, affordable natural gas. It will continue to operate as a standalone utility headquartered in Washington, D.C., with the same complement of dedicated employees, while also assisting in the management of AltaGas’ U.S. regulated utilities. AltaGas has a track record of great customer service, a broad geographic reach, expertise in natural gas infrastructure and power generation, and experience building and operating gas, power, wind, hydro and battery storage facilities. Together, AltaGas and Washington Gas will help shape a company committed to offering reliable service at affordable rates to customers in the D.C. area.

Q: What does this mean for Washington Gas’s customers and communities?

A: Following this combination, rates will remain reasonable, service will remain reliable and safe, and there will be more clean energy choices, more investments in the community, and a commitment to good, secure jobs. Washington Gas will continue operating as a standalone utility headquartered in Washington, D.C. with the same complement of dedicated employees, while also providing guidance to AltaGas’ U.S. regulated utilities.   

Q. Can customers count on reliable service from the new company? 

A: Absolutely. AltaGas is a well-established energy provider with a proven track record of delivering clean affordable energy to its customers. Customers in the U.S. gave the company a near-perfect score for customer service in 2016.

Q: Will there be any change to the company structure and Washington Gas employees?

A: Washington Gas will continue operating as a standalone utility headquartered in Washington, D.C., with the same complement of dedicated employees, while also providing guidance to AltaGas Ltd.’s U.S. regulated utility businesses.  

 Q. What can our community expect from the merger? 

A. Both AltaGas and Washington Gas have a tradition of investing in the communities they serve. The combined company will invest even more. Following the approval of the merger, the combined company will increase charitable contributions, invest even more in workforce training programs, and help make clean energy more affordable for its customers.

Q. What is the combined company's plan for renewable energy?

A. Growing our customer base of clean energy offerings, including natural gas, wind, hydro, solar and battery storage, will remain a focus. Together, AltaGas and WGL Holdings Inc. have a vision for more growth and jobs in the advanced energy economy, including distributed and renewable energy generation, battery storage and other customer-focused energy products

Q. What is involved in the regulatory filing process?

A. D.C., Maryland and Virginia have independent regulatory bodies (the Public Service Commission of the District of Columbia, Maryland Public Service Commission and the Virginia State Corporation Commission) that will determine whether to approve the two companies combining, in accordance with their statutory framework for the approval process. In our filings, with these regulatory bodies, we have outlined the many commitments we make to each jurisdiction.

The merger also is subject to other certain closing conditions, including approval by WGL Holdings, Inc. common shareholders, scheduled for May 10, 2017 in Washington, D.C., and some federal regulatory requirements. 

Specifically, AltaGas and WGL have filed their voluntary Joint Notice to the Committee on Foreign Investments in the United States (CFIUS) and an application with the Federal Energy Regulatory Commission (FERC). The transaction also is subject to the notification and reporting requirements under the Hart-Scott-Rodino Act, and other customary closing conditions.

Q: Who is AltaGas?

A: AltaGas generates and distributes clean and renewable energy across the U.S. and Canada. The company owns and operates  gas, power, wind, hydro and battery storage facilities, in addition to five regulated utilities (similar to Washington Gas), including two in the U.S. serving customers in Alaska and Michigan. As a result of the combination, AltaGas plans to move the headquarters of its U.S. power business to the Washington, D.C. region.