PORT HURON, Mich., March 22 /PRNewswire/ -- SEMCO ENERGY, Inc.
(Nasdaq: SMGS) today announced that it has reached an agreement to sell its
natural gas marketing subsidiary, SEMCO ENERGY SERVICES, to CoEnergy Trading
Company, a subsidiary of MCN Energy Group Inc. (NYSE: MCN).
SEMCO ENERGY had announced in February its intention to sell this
business. In announcing the sale, William L. Johnson, Chairman President and
Chief Executive Officer of SEMCO ENERGY, Inc., said: "Energy marketing is a
very competitive business with risks that do not fit well with our new
"Our focus now is to become one of the largest providers of underground
engineering and construction services in North America. The sale of SEMCO
ENERGY SERVICES will allow us to redirect our efforts toward continuing the
growth of our other businesses."
In 1998, SEMCO ENERGY SERVICES reported $398 million in revenues on sales
volume of 166 billion cubic feet (Bcf) to both retail and wholesale customers.
SEMCO ENERGY, Inc. expects to record a gain on the sale.
Other specific terms of the agreement were not disclosed.
Glen D. Kinder, President and Chief Executive Officer of CoEnergy Trading
Company, said the purchase of SEMCO ENERGY SERVICES includes retail sales of
natural gas in 1998 totaling 13 Bcf to approximately 140 industrial and
commercial customers and more than 4,000 retail accounts throughout Michigan,
building upon CoEnergy marketing operations that delivered nearly 500 Bcf of
gas in 1998.
"As a successful energy marketer focused in the Great Lakes, Mid-Atlantic
and New England regions of the United States and in eastern Canada, this
acquisition fits very well with our existing marketing, transportation and
storage assets," he said.
The closing of the sale is conditioned on the approval of the SEMCO ENERGY
Board of Directors. It also must be approved by the Federal Trade Commission
and the U.S. Justice Department under the Hart-Scott-Rodino Anti-Trust
Improvements Act of 1987. Closing is anticipated by March 31.
SEMCO ENERGY, Inc. has two other subsidiaries. SEMCO ENERGY GAS COMPANY
is a local natural gas distribution company with approximately 250,000
residential, commercial and industrial customers in Michigan's Upper and Lower
Peninsulas. SEMCO ENERGY VENTURES operates businesses involved in pipeline
engineering and quality assurance services, construction services, propane
distribution, intrastate pipelines and natural gas storage businesses in
Kansas, Louisiana, Michigan, Missouri, New Jersey, Tennessee, Texas and
SOURCE SEMCO ENERGY, Inc.
CONTACT: Media, Francis R. Lieder, Jr., 810-987-2200, ext. 4186, fax, 810-989-4098, or Analysts, Sebastian Coppola, 810-987-2200, ext. 4101, fax, 810-989-4098, both of SEMCO; or Stewart Lawrence of MCN, 313-256-6289