U.S.-based energy group National Fuel Gas Company announced it has raised gross proceeds of $350mn through a private placement of approximately 4.4 million common shares, sold at a price of $79.50 per share. The transaction, expected to close on December 17, was signed with a select group of accredited investors under a subscription agreement.
Targeted financing for regulated acquisition
Proceeds from this capital increase will fund part of National Fuel’s recently announced acquisition of CenterPoint Energy’s regulated gas distribution operations in Ohio. The transaction, still subject to regulatory approvals, is part of a broader strategy to strengthen National Fuel’s footprint in the Midwest utility market.
The company stated that the equity offering fully meets its capital needs for the acquisition. This is consistent with its objective to maintain its current investment-grade credit rating, which it considers a strategic element of its market position.
Exemption from public registration
The common stock was issued without prior registration with the Securities and Exchange Commission (SEC), relying on Section 4(a)(2) of the Securities Act of 1933 and Rule 506 of Regulation D. A prospectus supplement will be filed within 15 calendar days following the closing, under the company’s existing S-3 registration statement, to enable resale of the shares.
The offering was only available to qualified investors as defined under U.S. regulation, excluding any public solicitation. National Fuel emphasised that the announcement does not constitute an offer or solicitation in any jurisdiction where such an action would be unlawful.
Alignment with financial stability goals
The transaction comes as gas sector companies aim to consolidate regulated assets to secure stable revenue streams. Opting for equity funding over debt suggests an intention to preserve financial balance while enabling targeted growth.
The company continues to implement its strategic plan, adjusting its capital structure to support a growth transaction in a regulated segment viewed as less exposed to energy market volatility.
