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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Algonquin Power and Utilities Corp | TSX:AQN | Toronto | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.04 | 0.45% | 8.94 | 8.90 | 8.96 | 9.14 | 8.91 | 8.97 | 2,074,736 | 21:14:58 |
Algonquin has Extended Multiple Proposals to Acquire Gas Natural
Gas Natural Tells Algonquin the Company is "Not for Sale" and Refuses to Discuss a Proposed Transaction
Through its Self-preserving Pursuit of an Undefined and Uncertain Standalone Plan, Gas Natural Board is Preventing Shareholders from Receiving an Immediate and Compelling Premium for their Shares
Algonquin Urges Gas Natural Shareholders to Demand that the Gas Natural Board Maximize Shareholder Value through a Sale Process
Algonquin Encourages other Shareholders to Withhold Support for Incumbent Directors and Value Destructive Resolutions in Advance of the July 30, 2014 Annual Shareholders' Meeting
TORONTO, July 23, 2014 /CNW/ - Algonquin Power & Utilities Corp. ("APUC") (TSX: AQN) today announced that it sent the following letter to the Gas Natural Inc. (NYSE: EGAS) board of directors:
July 23, 2014
Board of Directors
Gas Natural Inc.
8500 Station Street, Suite 300
Mentor, Ohio 44060
Dear Sirs:
As you know, our parent company Algonquin Power & Utilities Corp. ("APUC"), currently owns approximately 4.9% of the outstanding shares of Gas Natural. Over the past seven months we have sent three letters and reached out numerous times to discuss a potential acquisition of Gas Natural by Liberty Utilities Co. ("Liberty Utilities"). The proposed transaction would provide an immediate and compelling premium to all Gas Natural shareholders. We urge Gas Natural shareholders to exercise their rights by insisting that the Board immediately commence a process to maximize shareholder value through a sale of the company.
We have advised that Liberty Utilities is prepared to move quickly to complete a transaction with Gas Natural that provides superior shareholder value creation with low execution risk, especially when compared to Gas Natural's poorly articulated and highly uncertain standalone strategy.
Notwithstanding, with our parent company being a large holder of Gas Natural stock, we share the interest of all shareholders of Gas Natural in maximizing shareholder value. To that end, we are supportive of a transaction structure that would permit a broader sale process and the realization of more than $13.00 per share should a higher offer be made by another qualified party. Notably, however, the only way such value can be delivered to Gas Natural shareholders is for you to commence a process to maximize shareholder value through a sale of the company.
LIBERTY UTILITIES IS A PROVEN OWNER OF REGULATED UTILITY ASSETS WITH STRONG GROWTH AND RETURNS
APUC, the parent of Liberty Utilities, is a growing distribution, generation and transmission utility company with approximately $3.7 billion in assets across North America, and which operates through two primary business units: Liberty Utilities and Algonquin Power Co. Liberty Utilities is a reliable, cost effective provider of rate regulated water, electricity and gas distribution and transmission utility services to more than 485,000 customers across the United States. Liberty Utilities has robust access to capital and a firm commitment to investing in the utilities it owns.
Liberty Utilities continues to grow through strong organic growth and capital reinvestment within our utility business and, most importantly, accretive acquisitions. The Liberty Utilities management team has a very strong track record of successfully acquiring and consolidating regulated utility companies, which has produced benefits for all stakeholders. In the last two and a half years alone, Liberty Utilities has acquired natural gas distribution utilities that provide regulated service to more than 285,000 customers in six states.
MULTIPLE ATTEMPTS TO PRIVATELY NEGOTIATE A TRANSACTION WITH GAS NATURAL HAVE BEEN SUMMARILY REJECTED
Our multiple proposals regarding a potential transaction have been consistently rebuffed without any negotiation or significant discussion. On May 7, 2014, we sent our most recent letter to the Gas Natural board in which we expressed interest in acquiring all outstanding shares of Gas Natural at a price of $13.00 per share – a premium of approximately 40% to Gas Natural's share price as of January 13, 2014, the day before we approached the Gas Natural board regarding a transaction. Importantly, the $13.00 per share price of our proposal also exceeds Gas Natural's all-time high share price of $12.35.
Unfortunately, you once again refused to engage in any dialogue. In fact, your response letter stated unconditionally that Gas Natural is "not for sale." We were, of course, taken aback by such a response, given the challenges facing the company.
WE BELIEVE A SALE OF GAS NATURAL IS IN THE BEST INTEREST OF SHAREHOLDERS, CUSTOMERS, REGULATORS AND EMPLOYEES
We believe that the only viable value maximization strategy is a sale of the company for the following reasons:
Your refusal to consider a sale of the company in favor of the pursuit of an undefined and uncertain standalone plan that preserves control of the company by existing directors and senior management ignores the opportunity to rapidly rectify the issues noted above through a business combination.
Liberty Utilities' interest in acquiring all of the shares of Gas Natural for $13.00 per share today represents a premium to Gas Natural's share price at any time over the last several years and we believe that it delivers far greater value than Gas Natural can reasonably expect to deliver on a standalone basis.
We are confident that Liberty Utilities' scale of operations and robust access to capital will allow the customers, regulators and employees of the company to reap the rewards of participation in a larger, more capable combined entity. Liberty Utilities is a unique, compelling and obvious partner for Gas Natural, and would be a willing buyer of all of the outstanding shares of Gas Natural at $13.00 per share.
GAS NATURAL SHAREHOLDERS DESERVE A BOARD AND MANAGEMENT TEAM COMMITTED TO ENHANCING VALUE FOR SHAREHOLDERS
We believe that shareholders deserve a board willing to consider all opportunities to maximize value. As we have stated, our preference is to move forward with a speedy and friendly transaction. Unfortunately, our attempts to engage with you and your management team have been met with little more than cursory dismissals. Your response has been, instead, to propose the adoption of resolutions that will further entrench the board and senior management and facilitate continued disregard for the best interests of the company's shareholders.
In light of your continued refusal to engage in a productive dialogue about the merits of a transaction to maximize shareholder value, we will be encouraging all shareholders to consider what you have failed to consider: Maximize Value For Gas Natural's Shareholders Through A Sale Of The Company.
We intend to interact with the company's other shareholders to encourage them to urge you to commence a sale process. If you fail to take action, we will ask that shareholders join us in voting against the incumbent board of directors and the value destructive anti-tender offer resolutions in advance of the upcoming July 30, 2014 shareholders' meeting.
Sincerely,
David Pasieka
President, Liberty Utilities Co.,
A subsidiary of Algonquin Power & Utilities Corp.
The Opinion and Order from the Public Utilities Commission of Ohio that is referenced in this press release is available at: http://dis.puc.state.oh.us/TiffToPDf/A1001001A13K14B00651E38055.pdf.
About Algonquin Power & Utilities Corp.
Algonquin Power & Utilities owns and operates a diversified $3.7 billion portfolio of regulated and non-regulated utilities in North America. The regulated utility business provides water, electricity and natural gas utility services to over 485,000 customers through a portfolio of regulated generation, transmission and distribution utility systems. The non-regulated electric generation subsidiary has invested in renewable energy and thermal energy facilities representing more than 1,100 MW of installed capacity. Algonquin Power & Utilities Corp. delivers continuing growth through an expanding pipeline of renewable power and clean energy projects, organic growth within its regulated utilities and the pursuit of accretive acquisition opportunities. Common shares and preferred shares are traded on the Toronto Stock Exchange under the symbols AQN, AQN.PR.A and AQN.PR.D. Visit Algonquin Power & Utilities Corp. at www.AlgonquinPowerandUtilities.com and follow us on Twitter @AQN_Utilities.
SOURCE Algonquin Power & Utilities Corp.
Copyright 2014 PR Newswire
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