KeySpan Sells its Shares in The Houston Exploration Company
KeySpan Corporation expects to reduce its ownership interest in its affiliate company, The Houston Exploration Company.
The anticipated stock repurchase of three million shares by Houston Exploration will be funded from the proceeds of a stock offering by Houston Exploration and will reduce KeySpan's current ownership in Houston Exploration from approximately 66 percent to approximately 56 percent. If the over-allotment option of 300,000 shares is exercised, KeySpan's ownership will be reduced to approximately 55 percent. This transaction is expected to generate net proceeds of approximately $ 79 million (excluding any over-allotment) for KeySpan. "This transaction demonstrates our ongoing commitment to monetize our non-core assets and focus on growing our core businesses," said Robert B. Catell, Chairman and CEO of KeySpan. "KeySpan intends to use the proceeds from this transaction to pay down debt and further strengthen our balance sheet. We believe this transaction will enhance the value of Houston Exploration by broadening its shareholder base resulting in increased liquidity. We continue to evaluate our non-core investments and will monetize them in a manner that maximizes value to our investors."
The Company is committed to growing its core gas and electric businesses primarily through natural gas conversions, new electric generation and cost containment programs.
KeySpan is also reaffirming its 2003 earnings guidance of $2.45 to $2.60 per share. In addition, the Company is once again reaffirming its commitment to maintaining the dividend at its current annual rate of $1.78 per share.