EXCLUSIVE Southwest Gas nears Questar deal after Buffett loses outside sources

Oct. 3 (Reuters) – Southwest Gas Holdings (SWX.N) is in advanced talks to acquire Questar Pipeline Company, a gas transportation and storage business from Dominion Energy Inc (DN) that Warren Buffett has attempted to buy, have said people familiar with the matter on Sunday.

The deal would come three months after Dominion and the energy arm of Buffett’s Berkshire Hathaway Inc (BRKa.N) abandoned their deal with Questar over fears antitrust regulators would approve it. Dominion then initiated an auction process to sell Questar. Read more

Southwest Gas, a gas distribution company serving Arizona, California and Nevada, will pay nearly $ 2 billion, including debt, for Questar, whose pipeline and storage system spans Colorado, Utah and Wyoming, the sources said.

It would be an improvement on the deal with Berkshire Hathaway, which had agreed to pay $ 1.3 billion in cash for Questar and take on $ 430 million in debt. If negotiations are successful, Dominion could announce a deal with Southwest Gas as early as this week, the sources said.

The sources requested anonymity as the matter is confidential. Dominion and Southwest Gas did not respond to requests for comment.

Questar transports natural gas over 1,867 miles (3,005 km) of pipeline, with connections to other pipeline systems in the western and midwestern United States. It also owns the Clay Basin storage facility, the largest underground storage tank in the Rockies, according to its website.

Dominion announced in July 2020 that it would sell its entire gas infrastructure business to the energy arm of Berkshire Hathaway for $ 9.7 billion, including debt. While an agreement for most of the assets was reached in November 2020, Questar was left out as the Federal Trade Commission reviewed the acquisition. The companies abandoned the Questar deal in July this year, citing uncertainty over its regulatory approval.

For Southwest Gas, the acquisition would mark a northern expansion of its natural gas operations and boost its regulated operations, which provide stable cash flow and are preferred by utility investors. He also owns Centuri, a company that maintains pipelines.

Report by David French in New York; Editing by Daniel Wallis

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