NEW HAVEN, Conn. – UIL Holdings says it will expand its natural gas business by spending $1.86 billion in cash to buy the operations of Philadelphia Gas Works, which serves about 500,000 customers.
The New Haven, Conn., company said Monday that the deal also will create a more geographically diversified utility holding company, one that serves more than 1.2 million gas and electric customers.
The city-owned Philadelphia Gas Works manages about 6,000 miles of gas mains and service pipes.
The deal still needs approvals from the Philadelphia City Council and the Pennsylvania Public Utility Commission. UIL Holdings Corp. expects to close the deal in the first quarter. The company expects the acquisition to be neutral to earnings at first and then help its bottom line in the long term.
UIL shares closed at $38.72 on Friday.