Dominion Energy Contributing Retail Energy Business To New Partnership Created With IGS Energy, Financial Details Disclosed
November 4, 2019 Email This Story Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • firstname.lastname@example.org
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In September 2019, Dominion Energy entered into an agreement to form Wrangler Retail Gas Holdings, LLC, a partnership with Interstate Gas Supply, Inc. Wrangler will operate a nonregulated natural gas retail energy marketing business with Dominion Energy contributing its nonregulated retail energy marketing operations and Interstate Gas Supply, Inc. contributing cash.
Dominion Energy expects the initial contribution, consisting of SCANA Energy Marketing, Inc., to close in the fourth quarter of 2019, subject to approval from the Georgia Public Service Commission and clearance from the Federal Trade Commission under the Hart-Scott-Rodino Act.
Dominion Energy will receive approximately $250 million in cash proceeds, subject to working capital adjustments, and expects to recognize a gain of approximately $135 million ($75 million after-tax), net of an approximately $70 million write-off of goodwill.
Dominion Energy will have a 20% noncontrolling ownership interest in Wrangler which will be accounted for as an equity method investment as Dominion Energy has the ability to exercise significant influence, but not control, over the investee.
Over the next three years, Dominion Energy expects to contribute its remaining nonregulated retail energy marketing operations to Wrangler under the terms of the
September 2019 agreement. As a result, Dominion Energy will receive additional cash consideration which will be based upon future financial
performance. When these future contributions occur, Dominion Energy expects to retain a 20% noncontrolling ownership interest in Wrangler.
In Dominion's Southeast Energy segment (which is used to report the legacy SCANA retail marketing customers), Dominion reported that the average number of retail energy marketing customer accounts was 406,000 for the third quarter of 2019, versus 415,000 a year ago
In Dominion's Gas Infrastructure segment (which is used to report non-SCANA retail marketing customers), Dominion reported that the average number of retail energy marketing customer accounts was 379,000 for the third quarter of 2019, versus 867,000 a year ago