TriSummit to Acquire Utilities in Alaska for Approximately C$1 Billion (US$800 Million)

May 26, 2022 7:30 AM EDT | Source: TriSummit Utilities Inc.


  • Significantly enhances TriSummit's position as a premier growing North American utility and renewable energy company with ENSTAR being TriSummit's first move into the United States;
  • ENSTAR will continue to operate as a standalone utility headquartered in Anchorage, Alaska, preserving its corporate identity and providing the same safe, reliable and affordable service to its customers;
  • TriSummit intends to retain all of ENSTAR's dedicated employees and hire new Alaska employees to perform certain functions currently performed out of State;
  • ENSTAR will continue to invest in the community through charitable giving;
  • Following the close of the Transaction TriSummit expects to work closely with ENSTAR management to continue to support economic growth in the region; and
  • Permanent financing for the Transaction is expected to be completed in a manner to maintain TriSummit's BBB(high) credit rating.

Calgary, Alberta--(Newsfile Corp. - May 26, 2022) - TriSummit Utilities Inc. ("TriSummit" or "TSU") announced today the entering into of a definitive agreement with a subsidiary of AltaGas Ltd. ("AltaGas") (TSX:ALA) for a subsidiary of TriSummit to acquire 100 percent of ENSTAR Natural Gas Company ("ENSTAR") and the Alaska Pipeline Company, the Norstar Pipeline Company, Inc., and a 65 percent indirect interest in Cook Inlet Natural Gas Storage Alaska, LLC ("CINGSA") (collectively, the "Alaska Utilities Business"), in an all cash transaction (the "Transaction") valued at approximately C$1 billion (US$800 million), subject to customary closing adjustments.

"The dedication and culture of ENSTAR, which is very similar to TriSummit's, has provided them with a solid track record and makes this an excellent fit for our company," said Jared Green, President and CEO of TriSummit. "Our top priority is to ensure a very smooth transition, maintaining the strong relationships ENSTAR has in its communities, and to fully support ENSTAR as they continue to provide customers with safe, reliable and affordable service. I look forward to working with the ENSTAR team to serve Alaska."

"We are pleased to announce this transaction with TriSummit," said Randy Crawford, President and Chief Executive Officer of AltaGas. "The Alaskan Utilities have a long history of delivering safe, reliable and affordable energy to its customers, operating with an industry-leading safety record, and driving positive outcomes for all of its stakeholders. We believe that TriSummit will be an excellent steward to the Alaskan Utilities stakeholders in the next chapter of its corporate life, along with the continued direction from the highly capable Alaskan senior leadership team and the dedicated employees that will be joining TriSummit post-closing."

Strategic Fit

The Transaction significantly enhances TriSummit's position as a premier, growing North American utility and renewable energy company.

ENSTAR is the largest gas utility in the state of Alaska, servicing approximately 60 percent of the State's population, with 3,626 miles of transmission and distribution pipeline. CINGSA, located in Kenai, is the only commercial, fully contracted, state regulated gas storage facility in Alaska.

Combined, ENSTAR and its 65 percent interest in CINGSA had 2021 average rate base of approximately US$350 million.

The Transaction is expected to significantly increase TriSummit's scale, growing TSU's consolidated rate base by approximately 40 percent to C$1.5 billion, and more than doubling its customer base. The Transaction will also provide greater geographical and business diversification. After the close of the Transaction, TriSummit will operate in four distinct regulatory jurisdictions, three in Canada and one in the United States.

TriSummit's Commitment to ENSTAR's Communities, Customers and Employees

"We are excited about the future of having ENSTAR join the TriSummit family. I would like to welcome ENSTAR's employees and customers. We respect and value our employees and our customers and endeavour to provide the best customer experience and help build strong, vibrant communities. We look forward to the opportunity to do this," said Mr. Green.

Details of the Transaction

The Transaction was approved by the Boards of Directors of both TSU and AltaGas.

The Transaction is not subject to any financing contingency, and fully committed financing from TSU's indirect shareholders for all funds necessary is already in place. TriSummit expects the permanent financing of the Transaction to be approximately 50 - 55 percent common equity with the remaining financing to be in the form of long-term debt. TriSummit anticipates having access to the U.S. private placement market as part of the permanent financing plan.

Following the close of the Transaction, ENSTAR will maintain its existing headquarters in Anchorage and will continue to operate as a standalone utility in Alaska. Its current management team and employees will remain in place.

Transaction closing

The Transaction is expected to close no later than the first quarter of 2023, subject to certain customary closing conditions, including regulatory and government approvals and clearances, including approval by the Regulatory Commission of Alaska and compliance with applicable requirements under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, and the satisfaction of customary closing conditions.


CIBC Capital Markets is acting as exclusive financial advisor and Latham & Watkins LLP and Stikeman Elliott LLP are acting as legal advisors, to TriSummit. Deloitte LLP acted as an advisor for M&A transaction services to TriSummit.

About TriSummit Utilities

TSU is a Canadian company with natural gas distribution utilities and renewable power generation assets. TSU serves approximately 133,000 customers across Canada, delivering low carbon energy, safely and reliably.

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Incorporated in 1961, ENSTAR Natural Gas Company is the largest natural gas distribution company in Alaska, with its headquarters located in Anchorage. ENSTAR is a regulated public utility that delivers natural gas to more than 150,000 residential, commercial, and industrial customers in and around the Anchorage and Cook Inlet area, including Anchor Point, Big Lake, Bird Creek, Butte, Chugiak, Eagle River, Eklutna, Girdwood, Homer, Houston, Indian, Kachemak, Kasilof, Kenai, Knik, Nikiski, Nikolaevsk, Ninilchik, Palmer, Peters Creek, Portage, Sterling, Soldotna, Wasilla and Whittier. ENSTAR's service area encompasses approximately 60 percent of the population of Alaska.

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Media Information:

TriSummit Utilities Inc. 587 955 3660

Forward Looking Information

This news release contains forward-looking statements. When used in this news release, the words "may", "can", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "expect", "project", "opportunity" and similar expressions, as they relate to TriSummit or an affiliate of TriSummit, are intended to identify forward-looking statements. In particular, this news release contains forward-looking statements with respect to, among other things, the expected closing date of the Transaction, the expected benefits of the Transaction, financing plans for the Transaction, the effect of the Transaction on TSU's credit rating, plans for the operation of the Alaska Utilities Business, its employees, its transition, its headquarters and investments to be made in the community following close of the Transaction, and the impact of the Transaction in respect of TSU's business (including, without limitation, in respect of rate base and other characteristics) and on TSU's strategic plans. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such statements reflect TriSummit's current views with respect to future events based on certain material factors and assumptions. TriSummit believes these assumptions to be reasonable at this time, but the forward-looking statements are subject to certain risks and uncertainties, many of which are beyond TSU's control, including without limitation, satisfaction of all conditions to the Transaction; timely receipt of all necessary approvals; currency, exchange, and interest rates; timing and results of planned capital projects; the success of the transition in ownership; changes in market conditions; competition; governmental or regulatory developments; general economic conditions, and other factors set out in TriSummit's public disclosure documents. Many factors could cause TriSummit's actual results, performance or achievements to vary from those described in this news release, including without limitation those listed above. These factors should not be construed as exhaustive. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this news release as intended, planned, anticipated, believed, sought, proposed, estimated or expected, and such forward-looking statements included in this news release, should not be unduly relied upon. Such statements speak only as of the date of this news release. TriSummit does not intend, and does not assume any obligation, to update these forward-looking statements except as required by law. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

Rate base is an amount that a utility is required to calculate for regulatory purposes, and generally refers to net book value of the utility's assets for regulatory purposes. TSU refers to rate base of its utility business because it believes that such term assist in understanding TSU's business and is commonly used by investors and research analysts to help evaluate the performance of rate-regulated utilities.

Any securities offered in any such debt financing have not been and will not be registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

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