Atmos Energy 2000 Annual Report Download - page 25

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21
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Propane Merger
Early in 2000, Atmos and three other gas
utility companies announced a plan to combine
their propane assets and create a regional company,
US Propane. In June 2000, the partners announced
that they would combine the assets of US Propane
with Heritage Propane Partners, L.P. In August
2000, the transaction was completed and Atmos
is now an owner in the nation’s fifth largest retail
propane marketer.
Acquisition of Remaining
Interest in Woodward
Marketing LLC
In August 2000, the Company announced that
it would acquire the remaining 55 percent equity
interest in Woodward Marketing LLC in exchange
for approximately 1.4 million restricted shares of
Atmos common stock. Atmos currently owns a
45 percent equity interest in Woodward which it
acquired through its acquisition of United Cities
Gas Company in 1997.Woodward has a track
record of strong growth accompanied by some
of the highest customer satisfaction ratings in the
industry.The purchase of the remaining equity inter-
est in Woodward should increase the profitability,
scale and scope of our non-utility operations.
Growth through acquisitions is a key com-
ponent of Atmos’ strategy for increasing earnings
and building value for the Company. As a larger
company, Atmos will have an even greater com-
petitive advantage as the natural gas industry
continues toward unbundling of service and
becomes even more competitive.
Divestiture Opportunities
We also believe it makes sense to divest the
Company of assets in those states where Atmos
has a small number of customers with little oppor-
tunity for future growth. In October 2000, Atmos
announced the sale of its Gaffney, South Carolina
operations for approximately $5.8 million.The sale
is expected to be completed in December 2000.