Blackstone Invests $2.16B in NiSource’s NIPSCO, Acquires Minority Stake
January 4, 2024
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The company is a leading energy provider offering natural gas, electricity, and other energy-related products to residential, commercial, and industrial customers. Recently, the company’s NIPSCO (Northern Indiana Public Service Company) has been acquired by Blackstone Group, a global alternative asset manager. The acquisition is valued at $2.16 billion, with Blackstone taking a minority stake in NISOURCE ($NYSE:NI). This transaction is expected to accelerate the company’s growth plans and strengthen its balance sheet. The proceeds from this acquisition will be used to further invest in NISOURCE’s core business and fund its capital expenditures.
The funds are also expected to improve its credit profile and support additional investments in the future. NISOURCE is confident that this move will help the company take advantage of new opportunities in the energy market while continuing to provide reliable service to its customers. The transaction is subject to regulatory approval and is expected to be completed later this year.
Market Price
On Tuesday, Blackstone Group Inc made a strategic investment of $2.16 billion in NiSource’s (NISOURCE INC) NIPSCO, a natural gas and electric utility subsidiary, by acquiring a minority stake in the company. On the same day, NiSource’s stock opened at $26.4 and closed at $27.0, a 1.7% increase from the last closing price of 26.6. The investment by Blackstone will provide NiSource with long-term capital for its operations and help the company continue to provide safe and reliable natural gas and electric services to its customers.
The proceeds from the transaction will also be used to pay down NiSource’s debt and fund growth initiatives. This investment is a reflection of the confidence in the future of NiSource and its ability to deliver value for its shareholders. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Nisource Inc. More…
| Total Revenues | Net Income | Net Margin |
| 5.79k | 666.9 | 12.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Nisource Inc. More…
| Operations | Investing | Financing |
| 1.91k | -3.39k | 1.51k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Nisource Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 27.83k | 20.06k | 17.45 |
Key Ratios Snapshot
Some of the financial key ratios for Nisource Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 5.9% | 5.4% | 22.8% |
| FCF Margin | ROE | ROA |
| -11.3% | 11.4% | 3.0% |
Analysis
At GoodWhale, we’ve completed an analysis of NISOURCE INC‘s wellbeing. According to our Star Chart, NISOURCE INC has an intermediate health score of 4/10, meaning it might be able to safely ride out any crisis without the risk of bankruptcy. We classify NISOURCE INC as a ‘rhino’, a type of company that has achieved moderate revenue or earnings growth. Investors looking for a stable, well-established company might be interested in NISOURCE INC. Its strengths lie in asset, dividend, and profitability. Its growth is medium. Combined together, this makes NISOURCE INC an attractive option for investors seeking a reliable company to invest in. More…
Peers
NiSource Inc is an energy holding company that operates regulated natural gas and electric utilities. The company’s subsidiaries include Columbia Gas of Massachusetts, Inc., Columbia Gas of Ohio, Inc., NIPSCO Industries, Inc., and Northern Indiana Public Service Company. NiSource’s competitors include ALLETE Inc, Ameren Corp, Dominion Energy Inc.
– ALLETE Inc ($NYSE:ALE)
ALLETE Inc. is a diversified energy company with two electric utilities serving more than 750,000 customers in Minnesota and Wisconsin, and a non-regulated business that generates, transmits, stores and distributes electricity. The company has a market cap of 2.89B as of 2022 and a Return on Equity of 4.57%.
– Ameren Corp ($NYSE:AEE)
Ameren Corporation is a utility holding company engaged in the generation, transmission, and distribution of electricity and the distribution of natural gas. The company operates through four segments: electric generation, electric transmission, natural gas transmission, and natural gas distribution.
As of 2022, Ameren’s market capitalization is $19.8 billion and its return on equity is 10.16%. The company is headquartered in St. Louis, Missouri, and serves more than 2.4 million electric and natural gas customers in Missouri and Illinois.
– Dominion Energy Inc ($NYSE:D)
Dominion Energy is an energy company that operates primarily in the United States. The company is involved in the production and distribution of electricity and natural gas. Dominion Energy has a market cap of 53.62B as of 2022 and a Return on Equity of 7.47%. The company is a leading provider of electricity and natural gas in the United States. Dominion Energy has a diversified portfolio of assets and is one of the largest producers and transporters of energy in the United States.
Summary
NISOURCE INC. (NI) recently announced its agreement to sell a minority stake in NIPSCO for $2.16 billion to Blackstone Group LP. This deal is seen as a positive move for NI’s long-term growth strategy, as it will generate extra cash flow and improve liquidity. The funds from the sale of the stake will be used to reduce debt, build up reserves, and reinvest in NIPSCO’s infrastructure.
The transaction is expected to close in the second quarter of this year, subject to regulartory approvals. Analysts view this as a win-win situation for both companies, as it will create value for shareholders and benefit NIPSCO customers.
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