AltaGas and WGL Holdings, Inc. Announce Approval of Merger by the Maryland Public Service Commission

CALGARY, April 4, 2018 /CNW/ - AltaGas Ltd. (AltaGas) (TSX:ALA) and WGL Holdings, Inc. (WGL) (NYSE:WGL) are pleased to announce the achievement of positive regulatory approval from the Maryland Public Service Commission (Maryland PSC) to the proposed merger of AltaGas and WGL (the WGL Acquisition).  The 4:1 favourable decision by the Maryland PSC followed a comprehensive public process and contains a number of conditions. The companies will expeditiously review these conditions, which generally appear to be acceptable and consistent with the full suite of merger commitments offered up by the companies during the public process.

"We are pleased that the Maryland Public Service Commission has approved our acquisition of WGL," said David Harris, President and Chief Executive Officer of AltaGas. "This marks another major milestone in bringing together AltaGas and WGL to deliver long-term value to customers and shareholders alike as we build a stronger future together."

"We are confident that our combination with AltaGas will benefit residents, businesses and the economy of Maryland. We appreciate the Commission's careful consideration of the many positive benefits this merger brings to the state as they evaluated our application," said Terry D. McCallister, Chairman and CEO of WGL Holdings, Inc., the parent company of Washington Gas. "Washington Gas will be an even stronger company as part of the AltaGas family and the new resources available as part of this combination will provide benefits for the state for years to come."

The combination of AltaGas and WGL will bring together high quality, low-risk, long-lived infrastructure assets with a premier North American footprint. The combined entity will have over $20 billion in energy infrastructure assets and an enterprise value over $17 billion.  This provides a strong platform for growth with approximately $4.5 billion in secured growth projects and approximately $1.5 billion of additional growth opportunities in advanced stages of development through 2021.

The WGL Acquisition is expected to provide strong accretion to earnings per share and normalized funds from operations per share through 2021. Starting with the first full year in 2019, the WGL Acquisition is also expected to support visible dividend growth through 2021, while allowing AltaGas to maintain a conservative payout of normalized funds from operations. Closing of the WGL Acquisition continues to be on track for mid-2018. Financing to close the WGL Acquisition is fully backstopped with $2.6 billion in proceeds from AltaGas' bought deal and private placement of subscription receipts, which closed in the first quarter of 2017, and a US $3 billion fully committed bridge facility, which may be drawn upon for closing and could remain in place for up to 18 months thereafter.

With all financing in place to close the WGL Acquisition, AltaGas continues to evaluate and advance an asset monetization strategy in a prudent and timely fashion in step with the regulatory process and consistent with AltaGas' long-term strategic vision. Management expects the repayment of the bridge facility to result from the monetization of over $2 billion from its asset sales process and from offerings of senior debt and hybrid securities, subject to prevailing market conditions.

"Given the breadth, depth, and value of AltaGas' assets, we are fortunate in the choices we have with respect to our monetization strategy," said Mr. Harris. "We are conscious of the need to deliver a strong financial outcome for AltaGas, the right asset mix for the company on a go forward basis, and a meaningful financial return for our shareholders.  We are confident in our ability to monetize assets in a manner that achieves those results. We are actively in discussions on several fronts including the potential sale of appropriate minority interest(s) in our Northwest B.C. Hydro Facilities."

The regulatory review process continues in the District of Columbia. AltaGas and WGL have worked constructively with the District of Columbia Public Service Commission (DC PSC) and other parties involved in the regulatory proceedings to make sure customers benefit, existing jobs are protected, new jobs are added, and support for clean energy is advanced. A final decision from the DC PSC on the combination is expected by mid-2018.

As of today, the WGL Acquisition has received the following approvals:

Shareholders

• Approval from WGL shareholders on May 10, 2017.

Federal

• Approval from the Federal Energy Regulatory Commission (FERC), an independent agency that regulates the interstate transmission of natural gas, electricity and oil, on July 6, 2017;
• Expiration of the waiting period as of July 17, 2017, pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act), when the merger was deemed approved by the Federal Trade Commission and the Department of Justice; and
• Approval from the Committee on Foreign Investment in the United States (CFIUS) on July 28, 2017.

State

• Approval from the Virginia State Corporation Commission on October 20, 2017;
• Approval from the Maryland Public Service Commission on April 4, 2018.

Learn more about the combination at www.wgldeliveringmore.com.

About AltaGas

AltaGas is an energy infrastructure company with a focus on natural gas, power and regulated utilities. AltaGas creates value by acquiring, growing and optimizing its energy infrastructure, including a focus on clean energy sources. For more information visit: www.altagas.ca  

This news release contains forward-looking statements. When used in this news release, the words "may", "would", "could", "can", "will", "be", "intend", "possible", "plan", "develop", "anticipate", "target', "believe", "seek", "propose", "continue", "estimate", "expect", and similar expressions, as they relate to AltaGas or an affiliate of AltaGas, are intended to identify forward-looking statements. This news release contains forward-looking statements with respect to, among other things, acceptability of conditions from the Maryland PSC decision, the expected timing and outcome of the DC PSC decision, the anticipated date for closing the WGL Acquisition, ability to deliver long-term value and enhance the financial strength of the combined company, growth projects and opportunities, assets to be sold and the expected timing and proceeds from asset sales, expectations with respect to additional financing, financial outcomes, including without limitations, returns to shareholders, accretion to earnings per share and funds from operations per share, dividend growth and payout of funds from operations, access to capital, and the benefits of the WGL Acquisition, including without limitation, the protection of existing and addition of new jobs. 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 AltaGas' current views with respect to future events based on certain material factors and assumptions and are subject to certain risks and uncertainties, including without limitation, changes in market, competition, governmental or regulatory developments, general economic conditions and other factors set out in AltaGas' public disclosure documents. Many factors could cause AltaGas' 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, or incorporated by reference in this news release, should not be unduly relied upon. Such statements speak only as of the date of this news release. AltaGas does not intend, and does not assume any obligation, to update these forward-looking statements. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

SOURCE AltaGas Ltd.

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