Buyout speculation swirls around NiSource

2014-01-21T13:30:00Z 2014-02-17T12:49:07Z Buyout speculation swirls around NiSourceBy Keith Benman, (219) 933-3326

Merrillville-based NiSource Inc. is the subject of market speculation of a buyout, with its natural gas transmission and storage business making it an attractive target.

This week Bloomberg News joined the fray, reporting Dominion Resources Inc., of Richmond, Va., may be the lead suitor, based on reports Dominion is preparing to raise a buyout fund. 

Much of the pipeline delivery system that makes NiSource such an attractive target serves a booming energy region known as the Utica Shale in Ohio and other states. It is named for the geologic formation where the natural gas is found.

Former NIPSCO chief executive Jimmy Staton retired as head of NiSource's pipeline transmission and storage business effective Dec. 31, but he continues on as a full-time company employee until March 31, according to documents filed with the Securities and Exchange Commission.

NiSource spokesman Mike Banas said on Tuesday the company does not comment on market speculation.

"We are pleased with our current portfolio of businesses and have a solid, well established plan that is consistently delivering value for customers, investors and other key stakeholders," Banas said on Tuesday.

NiSource stock was trading at $34.23 per share in late afternoon trading on the New York Stock Exchange Tuesday, up 34 cents.

In addition to its gas transmission and storage business, NiSource owns utilities in seven states, including NIPSCO in Indiana.

NiSource CEO Robert Skaggs Jr. has recently resurrected the idea of forming a Master Limited Partnership (MLP) for NiSource's pipeline and storage business as a way of raising cash for its expansion. Dominion is also known to be interested in forming one.

Under a MLP the company forming it generally retains majority control but issues shares to what are essentially minority owners in order to raise cash.

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