Spire Acquires Piedmont Natural Gas, Expanding Utility Services in Nashville for $2.48 Billion
- Spire Inc. is acquiring Piedmont Natural Gas's Tennessee distribution business for $2.48 billion from Duke Energy.
- The acquisition adds 205,000 customers in Greater Nashville, enhancing Spire's operational footprint across multiple states.
- Spire plans to create Spire Tennessee, ensuring seamless service continuity and operational excellence during the transition.
Strategic Growth in the Utility Sector: Spire's Acquisition of Piedmont Natural Gas
In a significant development for the utility industry, Spire Inc. has reached an agreement to acquire the Tennessee distribution business of Piedmont Natural Gas from Duke Energy for $2.48 billion. This deal, which is expected to close in the first quarter of 2026, positions Spire to expand its footprint in one of the fastest-growing regions in the United States. The acquisition will add approximately 205,000 customers in the Greater Nashville area, enhancing Spire's customer base and bolstering its operations across multiple states, including Missouri, Alabama, and Mississippi.
The transaction represents a strategic alignment for both Spire and Duke Energy. With a purchase price multiple of 1.5 times the estimated rate base for 2026, it is anticipated to be accretive to Spire’s adjusted earnings per share, supporting a targeted long-term growth of 5-7%. Spire’s CEO, Scott Doyle, emphasizes that this move not only enhances their service capacity but also underscores their commitment to safety and community engagement. The addition of nearly 3,800 miles of distribution and transmission pipelines will strengthen Spire's operational foundation, enabling it to deliver reliable energy to its growing customer base in Tennessee.
Moreover, the acquisition aligns with Duke Energy's broader strategy to modernize its energy infrastructure while addressing record customer growth. Duke Energy's CEO, Harry Sideris, highlights that approximately $800 million from the sale will be allocated to offsetting debt at Piedmont Natural Gas, while the remaining proceeds will support the company's ambitious $83 billion capital plan. This plan aims to enhance energy delivery and create value for both customers and shareholders. Sideris expresses confidence in Spire’s capability to foster the growth of the Tennessee natural gas business and appreciates the Nashville community's longstanding partnership.
In conjunction with the acquisition, Spire plans to establish Spire Tennessee, a new business unit dedicated to serving the Nashville area. This strategic move not only expands Spire’s utility operations but also facilitates a smoother transition for Duke Energy employees associated with the Tennessee business, ensuring continuity in customer service. Both companies recognize the importance of maintaining operational excellence and customer satisfaction during this transition period, setting the stage for a successful integration of the Piedmont Natural Gas assets.
Overall, this acquisition is a testament to the evolving landscape of the utility sector, where strategic mergers and acquisitions play a crucial role in enhancing service delivery and bolstering growth in rapidly expanding markets.
