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|CHESAPEAKE UTILITIES CORPORATION COMPLETES MERGER WITH GATHERCO, INC.|
Dover, Delaware – Chesapeake Utilities Corporation (NYSE: CPK) ("Chesapeake Utilities" or "Company") today announced completion of the merger of Gatherco, Inc. ("Gatherco") into Aspire Energy of Ohio, LLC ("Aspire Energy"), Chesapeake Utilities' newest wholly-owned subsidiary. The transaction had an aggregate value of approximately $59.2 million.
Gatherco, located in Orrville, Ohio, was established in 1997 when it acquired Columbia Gas Transmission's natural gas gathering assets in Ohio. Gatherco has operations in 40 counties throughout the state. Gatherco's assets include 16 gathering systems and over 2,000 miles of pipelines and right-of-way in central and eastern Ohio.
With the merger now completed, Aspire Energy will use these assets to provide natural gas midstream services, processing and transportation services to over 300 producers, and wholesale natural gas supply to over 30,000 end users in Ohio. Aspire Energy will report to Elaine B. Bittner, Chesapeake Utilities Senior Vice President of Strategic Development. "This transaction is a direct result of investments that we began making in 2013 to implement our Company's strategic growth plan. In addition, this is our first significant non-regulated natural gas value chain initiative executed by a cross-section of our employees to actualize strategic objectives in that growth plan," Ms. Bittner said.
Michael P. McMasters, President and Chief Executive Officer of Chesapeake Utilities, remarked, "We are pleased with how efficiently the merger was completed. It is a great strategic win for the management and customers of both companies and is projected to generate accretive earnings in the first full year of operation following the merger. In addition, we believe that there are significant growth opportunities to add both production and distribution customers in and around the existing system. Gatherco's valuable rights of way could also present additional opportunities for growth."
Tony Kovacevich, President of Gatherco, added, "Our employees are happy to be joining the Chesapeake Utilities family of companies and look forward to having the resources to capitalize on our growth opportunities. As Aspire Energy, we will continue to provide our customers with the high-quality service they are accustomed to receiving, and we welcome the values and service tradition that Chesapeake Utilities now brings to Ohio."
The definitive merger agreement was announced on February 2, 2015 and was approved by Gatherco shareholders on March 20, 2015.
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