Reuters: Regulatory News: UPDATE 1-Teco Energy widens customer base with $750 mln deal

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UPDATE 1-Teco Energy widens customer base with $750 mln deal May 28th 2013, 11:44 Tue May 28, 2013 7:44am EDT * To assume about $200 million in debt * Says deal will increase customer base by 50 percent May 28 (Reuters) - Teco Energy Inc said it would acquire New Mexico Gas Co from utility holding company Continental Energy Systems LLC for about $750 million to increase its customer base by 50 percent in Florida and New Mexico. Teco, which owns Florida utility Tampa Electric Co and coal producer Teco Coal, said it would also assume about $200 million in debt. New Mexico Gas distributes gas to about 509,000 customers, mainly residential, in New Mexico. Teco Energy units will serve more than 1.5 million regulated electric and gas utility customers in Florida and New Mexico upon the close of the deal, which is subject to state and federal regulatory approvals. The deal, expected to add to earnings in 2015, is likely to close in the first quarter of 2014. New Mexico Gas Co had earnings before interest, taxes, depreciation, and amortization (EBITDA) of $86 million in the 12 months to Jan. 31. Morgan Stanley was Teco Energy's financial adviser. Skadden, Arps, Slate, Meagher & Flom LLP and Cuddy & McCarthy LLP are the legal advisers. Credit Suisse Securities and Tudor, Pickering, Holt & Co are Continental Energy Systems' financial adviser and Cravath, Swaine & Moore LLP the legal adviser. Link this Share this Digg this Email Reprints

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