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Dominion Energy, Scana To Merge In All-stock Deal Valued At About $7.9 Bln

Dominion Energy, Inc. (D) and Scana Corp. (SCG) said they have agreed to combine in a stock-for-stock merger valued at about $7.9 billion.

Under the deal, Scana shareholders would receive 0.6690 shares of Dominion Energy common stock for each share of Scana common stock, the equivalent of $55.35 per share, or about $7.9 billion based on Dominion Energy's volume-weighted average stock price of the last 30 trading days ended Jan. 2, 2018.

Including assumption of debt, the transaction is valued at approximately $14.6 billion.

The agreement also calls for significant benefits to Scana's South Carolina Electric & Gas Company subsidiary or SCE&G electric customers to offset previous and future costs related to the withdrawn V.C. Summer Units 2 and 3 project.

This includes a $1.3 billion cash payment within 90 days upon completion of the merger to all customers, worth $1,000 for the average residential electric customer.

On completion of the merger, the combined company would operate in 18 states from Connecticut to California. The company would deliver energy to approximately 6.5 million regulated customer accounts in eight states and have an electric generating portfolio of 31,400 megawatts and 93,600 miles of electric transmission and distribution lines.

The combined company also would have a natural gas pipeline network totaling 106,400 miles and operate one of the nation's largest natural gas storage systems with 1 trillion cubic feet of capacity.

Scana would operate as a wholly owned subsidiary of Dominion Energy. It would maintain its significant community presence, local management structure and the headquarters of its SCE&G utility in South Carolina.

Dominion Energy noted that the transaction would be accretive to its earnings upon closing, which is expected in 2018. According to the company, the merger also would increase its compounded annual earnings-per-share target growth rate through 2020 to 8 percent or higher.

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