Duke Energy has announced it will sell its Piedmont Natural Gas Tennessee local distribution company business to Spire Inc. for $2.48 billion in cash. The transaction is expected to close in the first quarter of 2026, pending regulatory approval by the Tennessee Public Utility Commission and the expiration or termination of the waiting period under the Hart-Scott-Rodino Act.
The sale price represents a 1.8x multiple of the 2024 year-end rate base and a 24x multiple of 2024 earnings, which Duke Energy describes as a significant premium to its common stock. About $800 million from the proceeds will be used to offset debt at Piedmont Natural Gas, while existing tax credits are expected to cover most cash taxes resulting from the deal. The remaining $1.5 billion will help fund Duke Energy’s five-year capital plan totaling $83 billion, which is focused on energy modernization investments.
Harry Sideris, president and chief executive officer of Duke Energy, said: “The transaction allows us to efficiently fund accelerating investment opportunities driven by record customer growth and a deepening economic development pipeline. We’re confident Spire will support the continued growth and success of the Tennessee natural gas business and serve as an incredible operator for the benefit of employees, customers and communities.”
Sideris also thanked customers and staff: “I want to thank our customers and the Nashville community for allowing us to serve as their trusted energy partner, regional supporter and neighbor for more than 40 years. I also want to recognize the entire Piedmont Natural Gas team who support the Tennessee business for their unwavering commitment to our customers, operational excellence and industry-leading service. They have set the bar for what it means to be a best-in-class natural gas business and will continue to do so for many years to come.”
The agreement includes nearly 3,800 miles of distribution and transmission pipelines along with a liquefied natural gas facility serving about 205,000 customers in Greater Nashville. Employees primarily supporting this business will transition over to Spire after closing.
Scott Doyle, president and chief executive officer of Spire, commented: “This acquisition is a natural fit for Spire, allowing us to expand our core utility business and increase our utility customer base to nearly two million homes and businesses.” He added: “We look forward to serving customers in the Nashville area and safely delivering the energy they need.” Doyle further stated that Duke Energy and Piedmont Natural Gas share Spire’s value of safety: “We’re eager to build on the foundation of exceptional customer service and community engagement that Piedmont Natural Gas customers in Tennessee have enjoyed for years… We look forward to welcoming their employees and customers, and becoming an active participant in the growing Nashville business community.”
JP Morgan Securities LLC and RBC Capital Markets LLC advised Duke Energy on financial matters related to this deal; Skadden, Arps, Slate, Meagher & Flom LLP served as transactional legal advisor.
Duke Energy continues its strategy toward modernizing electric grid infrastructure as part of its long-term capital plan (https://www.duke-energy.com). The company invests in upgrades across generation sources including natural gas, nuclear power, renewables, and storage solutions.
Piedmont Natural Gas serves more than 1.2 million residential, commercial, industrial, and power generation customers across North Carolina, South Carolina, and Tennessee (https://www.piedmontng.com/). According to J.D. Power’s latest study (https://www.jdpower.com/business/press-releases/2024-us-gas-utility-residential-customer-satisfaction-study), Piedmont earned top marks among large utilities in residential customer satisfaction within its region.
Spire Inc., based in Missouri but operating utilities across Alabama (https://www.spireenergy.com/), Mississippi (https://www.spireenergy.com/), Missouri (https://www.spireenergy.com/), provides services through subsidiaries such as Spire Marketing and Spire Midstream.
The companies noted that forward-looking statements are subject to risks described in reports filed with federal regulators at sec.gov.
