MDU rep foresees 'seamless' acquisition for Moses Lake operation

MDU buys Cascade Natural Gas in company's 'biggest transaction' ever

MOSES LAKE — On the heels of the announcement that a North Dakota company is acquiring Cascade Natural Gas, a spokesperson says Moses Lake's operation will not see much of an impact.

It was announced Monday that Bismarck, N.D.-based MDU Resources is acquiring the Seattle-based Cascade Natural Gas in a deal worth about $475 million.

"It's the biggest transaction we've ever made. We've never exchanged this amount of money with anyone," MDU spokesman Dan Sharp told the Associated Press Monday.

Linda Donlin, MDU director of communications and public relations, said the company does not anticipate the Moses Lake operation will be affected at all.

"It should be pretty much seamless for customers and operations people are needed in all locations, so we don't see an impact in that area at all," she said. "The name will stay the same, the operations will stay the same, delivery to the customer, it's really just the ownership of the company that's going to change."

Cascade Natural Gas Corp., serves about 235,000 customers in Washington and Oregon, MDU said in announcing the acquisition. The Bismarck-based energy and natural resource company said it is buying Cascade for $26.50 per share in cash.

The purchase will be financed through "traditional means," including long-term debt and equity, MDU's statement said.

"Cascade is in a high-growth area, and is a well-managed operation," Martin White, MDU's chairman and chief executive officer, said in the company statement. The acquisition is a "great strategic fit with our existing regulated operations and is consistent with our long-term objective of growing our regulated utility," he said.

Cascade, founded in 1953, employs about 380 people, MDU said.

The deal, subject to shareholders' approval, is expected to be wrapped up next year, MDU said.

Cascade will join Montana-Dakota Utilities Co., and Great Plains Natural Gas Co., as MDU Resources utility businesses. MDU said Montana-Dakota and Great Plains serve about 250,000 natural gas customers and 120,000 electric customers in five Upper Midwest states.

Cascade has about $170 million in debt, Sharp said. "Companies are usually judged on their debt versus their equity, and theirs is about the same as ours," he said. "It wasn't something we even blinked at."

"We are very pleased and excited by the opportunity to join the MDU Resources family of companies," David W. Stevens, president and chief executive officer of Cascade, said in a statement which appeared on the Cascade Web site. "Earlier this year we announced plans to evaluate strategic alternatives to enhance our stockholder value and this merger is the result of our evaluation. MDU Resources is a strong company with excellent management and a long history of successful growth and very positive stockholder returns. Utility operations represent the historic core of their business and our shareholders, customers and employees will be well-served by this merger."

Also on the Cascade Web site, it is stated that when the transaction is completed, Cascade common stock will cease to be publicly traded. Cascade will become a wholly owned subsidiary of MDU Resources, continuing to operate as Cascade Natural Gas Corp.

Herald staff writer Matthew Weaver contributed to this report