CorEnergy to Sell MoGas and Omega Pipeline Systems to Spire

Source: 5/25/2023, Location: North America

CorEnergy Infrastructure Trust, Inc. announced entry into a definitive agreement to sell its MoGas and Omega pipeline systems (“MoGas System”) to Spire Inc. for approximately $175 million in cash, subject to final working capital adjustments. The MoGas System is an interstate natural gas transmission and distribution system providing service to markets in Missouri and Illinois.

Transaction Highlights
All-cash transaction valued at approximately $175 million
Expected to close in the third quarter 2023, subject only to anti-trust clearance and customary closing conditions
Estimated $165 million of net proceeds after taxes and transaction-related costs
Net proceeds will be used to repay all CorEnergy bank debt at closing, approximately $100 million

Dave Schulte, Chairman and Chief Executive Officer of CorEnergy, said: “The sale of our MoGas and Omega systems enables us to significantly de-leverage our balance sheet and strengthen our overall capital structure. This is one of several 2023 initiatives we are undertaking to improve our balance sheet and operating results, including proposed tariff increases and corporate cost reductions.”

“The team at MoGas and Omega has produced reliably profitable results and an excellent safety record as a part of CorEnergy, and we wish to thank them for their dedicated service over the past several years,” said Schulte. “Spire shares our commitment to providing safe, reliable, and environmentally sustainable service to the customers and communities that we serve, and we are pleased they will retain our field operating personnel.”

The Company plans to provide an updated 2023 outlook, including opportunities within its California energy transition and other business initiatives, after the transaction has closed.

Evercore acted as the company’s financial advisor while K&L Gates served as legal counsel.

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