Spectra Energy Partners Acquires Additional 24.5 Percent Interest in Gulfstream Natural Gas System, L.L.C. from Spectra Energy Corp
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o Expect acquisition to be accretive to cash available for distribution
o Increases ownership interest in Gulfstream Natural Gas System, L.L.C. to 49 Percent
HOUSTON, Nov. 30, 2010 - Spectra Energy Partners, LP (NYSE: SEP) today announced it has acquired an additional 24.5 percent interest in Gulfstream Natural Gas System, L.L.C. (Gulfstream) from Spectra Energy Corp (NYSE: SE) for approximately $330 million, consisting of approximately $66 million in newly-issued partnership units, the assumption of approximately $7.4 million in debt owed to a subsidiary of Spectra Energy Corp, and approximately $256.6 million in cash. The acquisition increases Spectra Energy Partners' interest in Gulfstream to 49 percent.
Gulfstream owns a 745-mile interstate natural gas transportation system, which extends from Pascagoula, Miss., and Mobile, Ala., across the Gulf of Mexico into Florida and has market delivery capability of 1.26 billion cubic feet per day (Bcf/day) of natural gas.
Spectra Energy Partners expects the transaction to be accretive to cash available for distribution on a per unit basis.
"Gulfstream's pipeline is a well-positioned asset with a portfolio of long-term, fee-based contracts and a solid position in the Florida market," said Gregory J. Rizzo, president and chief executive officer. "We are pleased to have an additional stake in Gulfstream which further enhances Spectra Energy Partners' profile of steady, fee-based cash flows and aligns nicely with our strategy to deliver value to our investors," continued Rizzo.
To fund its cash consideration of approximately $256.6 million, the Company utilized its existing credit facility. It expects long-term financing for the transaction to be a combination of debt and equity.
The terms of the transaction were unanimously approved by the Board of Directors of the general partner of Spectra Energy Partners' general partner, based on the unanimous approval and recommendation of the Board's conflicts committee, which is comprised entirely of independent directors. The conflicts committee engaged Tudor, Pickering, Holt & Co. Securities, Inc. to act as its financial advisor and Andrews & Kurth LLP to act as its legal advisor.
About Spectra Energy Corp
Spectra Energy Corp, a FORTUNE 500 company, is one of North America's premier natural gas infrastructure companies serving three key links in the natural gas value chain: gathering and processing, transmission and storage, and distribution. For nearly a century, Spectra Energy and its predecessor companies have developed critically important pipelines and related infrastructure connecting natural gas supply sources to premium markets. Based in Houston, Texas, the company operates in the United States and Canada approximately 19,100 miles of transmission pipeline, more than 305 billion cubic feet of storage, as well as natural gas gathering and processing, natural gas liquids operations and local distribution assets. The company also has a 50 percent ownership in DCP Midstream, one of the largest natural gas gatherers and processors in the United States. Spectra Energy is a member of the Dow Jones Sustainability World and North America Indexes and the U.S. S&P 500 Carbon Disclosure Project's Leadership Index for both Carbon Performance and Disclosure. For more information, visit www.spectraenergy.com.
SOURCE Spectra Energy Partners
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Web Site: www.spectraenergy.com
