UGI to sell debt, convertible securities for $540 million acquisition

By Devika Patel

Knoxville, Tenn., Jan. 5 – UGI Corp. will take on debt and convertible debt to acquire Mountaintop Energy Holdings LLC, owner of Mountaineer Gas Co., the largest gas local distribution company in West Virginia, for $540 million, which includes the assumption of about $140 million of debt.

“UGI does not expect to issue any common equity as part of this transaction and plans to finance the acquisition through a combination of debt, equity-linked securities, like mandatory convertible securities, and existing liquidity,” chief financial officer Ted J. Jastrzebski said on the company’s conference call announcing the transaction on Tuesday.

“As always, we will be financing this transaction with an appropriate mix to ensure we are optimizing accretion and maintaining a strong balance sheet,” Jastrzebski said.

The company expects to finalize the financing for the acquisition within a few months, president and chief executive officer John L. Walsh said on the call.

Settlement of the acquisition is expected in the second half of calendar year 2021.

UGI is a King of Prussia, Pa.-based distributor and marketer of energy products and services.

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