TECO Energy to join forces with three other companies to create national propane operation
TAMPA, February 16, 2000
TECO Energy, Inc. (NYSE/TE) today announced that it has entered into an agreement to form a joint venture which combines its Peoples Gas Company propane operations with the propane operations of Atmos Energy Corporation (NYSE: ATO), Dallas, Texas; AGL Resources, Inc. (NYSE: ATG), Atlanta, Ga.; and Piedmont Natural Gas Company, Inc. (NYSE: PNY), Charlotte, N.C.
The combined entity, to be named US Propane, L.P., will be among the 10 largest propane retailers in the nation, with nearly 200,000 customers. Focused on the Southeast, US Propane will have operations in Alabama, Florida, Georgia, Kentucky, North Carolina, South Carolina and Tennessee.
This transaction is subject to regulatory approval for one of the proposed participants and other customary conditions. The participating companies expect this transaction to be completed by May 1, 2000. They are being advised in the transaction by Paine Webber, Inc.
"This union allows Peoples Gas Company and the other participating companies to improve their regional competitiveness and target growing to be one of the top retail propane providers in the country," said TECO Energy Chairman and Chief Executive Officer Robert Fagan. "It’s a major opportunity for each of us to fully realize the potential of our propane businesses."
"We believe the combination will enhance customer service while providing growth opportunities for our employees and long-term value for our shareholders," added Fagan. "And, our customers will continue to receive the high quality service they have come to expect from Peoples Gas under the US Propane umbrella."
A nationwide search for a chief executive officer to establish US Propane and lead its growth is currently underway. The company has tentatively selected Nashville for its headquarters.
TECO Energy is a diversified, energy-related holding company headquartered in Tampa. Its principal businesses are Tampa Electric, Peoples Gas, TECO Transport, TECO Power Services, TECO Coal, TECO Coalbed Methane, and Bosek, Gibson and Associates.
Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. Certain factors that could cause actual results to differ materially from those projected in these forward-looking statements include the following: general economic conditions, particularly those in Tampa Electric’s service area affecting energy sales; weather variations affecting energy sales and operating costs; potential competitive changes in the electric and gas industries, particularly in the area of retail competition; regulatory actions affecting Tampa Electric and Peoples Gas System; commodity price changes affecting the competitive positions of Tampa Electric and the Peoples Gas companies as well as the margins at TECO Coalbed Methane and TECO Coal; interest rates on borrowings and general availability of capital on satisfactory terms; changes in and compliance with environmental regulations that may impose additional costs or curtail some activities; TECO Power Services’ ability to successfully develop and operate its projects; TECO Transport’s ability to successfully enter new markets; Tampa Electric's ability to successfully resolve its pending litigation with the EPA; and TECO Coal’s ability to successfully operate its new synthetic fuel production facilities in a manner qualifying for favorable federal income tax treatment. Some of these factors are discussed more fully under "Investment Considerations" in the company’s Annual Report on Form 10-K for the year ended December 31, 1998, and reference is made thereto.