http://business.financialpost.com/
CALGARY – TransCanada Corp. proved rumours of its interest in Columbia Pipeline Group true on Thursday when it announced a US$13-billion deal to buy the Texas-based natural gas pipeline firm.
At the same time, the Calgary-based pipeline company announced it was overhauling its existing business to pay for the transaction by raising $4.2 billion. The company is also selling off its power-generation stations in the northeastern United States and its minority interest in its Mexican natural gas pipelines.
TransCanada president and CEO Russ Girling called the US$13-billion deal — a price tag that includes US$2.8 billion worth of Columbia’s debt — “truly transformational.”
The deal announcement ends a week of speculation about whether or not TransCanada would make an offer for Houston-headquartered Columbia, a natural gas pipeline operator spun out of NiSource Inc. in 2015.
Rumours of negotiations between the two companies caused a trading halt for TransCanada’s shares on the Toronto Stock Exchange last week.
“With this acquisition, we believe we have an incumbency position in North America’s two most prolific natural gas basins,” Girling said on a conference call Thursday.
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