UGI to buy AmeriGas shares it doesn’t own for $2.44 billion; UGI slashes EPS guidance
UGI Corp. said Tuesday it will buy the 69.2 million shares of propane marketer AmeriGas Partners L.P. that it doesn’t already own for the equivalent of $2.44 billion in cash and stock. Under terms of the deal, UGI will exchange 0.50 of its shares plus $7.63 in cash for each of AmeriGas shares. Based on Monday’s closing prices, that values AmeriGas shares at $35.325 each, a 13.5% premium. AmeriGas will no longer be a master limited partnership, and will become a subsidiary of UGI. The deal is expected to increase UGI’s cash flow per share by 15% for fiscal 2020, support the increase in UGI’s annualized dividend by 16 cents a share for the July dividend and add to adjusted EPS in fiscal 2020. Separately, UGI cut its 2019 adjusted EPS guidance range to $2.40 to $2.60 from $2.75 to $2.95, citing “significantly warmer-than-normal winter weather” in its European markets. UGI said it plans to increase its second-quarter dividend by 15%, to 30 cents a share from 26 cents, and by an additional 10% after the AmeriGas deal closes. UGI and AmeriGas shares were still inactive in premarket trade. Over the past 12 months, UGI shares have rallied 26.0%, AmeriGas’s stock has shed 22.5% and the S&P 500 has advanced 11.1%.
Source : MTV
