Empire closes acquisition of gas distributor

Kansas City-based Aquila’s gas distribution operations include about 48,500 customers in cities in northwest, north central and west central Missouri.

The total purchase price was $102.1 million, including working capital and net plant adjustments of $17.1 million, according to an Empire news release. Those adjustments are subject to changes.

Aquila’s 51 field employees were offered Empire employment, and 48 of those chose to come on board, said Ron Gatz, Empire’s chief operating officer of gas.

“The purchase of the gas property will allow us to diversify our weather risk, balancing our current summer air conditioning peak with this natural gas winter heating peak,” Gatz said in the release. “In addition, this property is located in close proximity and is regulated by an agency with whom we are familiar.”

Empire announced in September its plan to purchase Aquila; the plan received Missouri Public Service Commission approval on April 18.

Permanent financing of the acquisition is expected to be a mix of debt and equity, according to the release. The acquisition was initially financed by $55 million of privately placed 6.82 percent First Mortgage Bonds, due in 2036 and issued by Empire District Gas.

Short-term debt was issued by Empire District Electric and is expected to be replaced with common equity of the electric company.