Dominion Energy Announces Proposal to Acquire Outstanding Dominion Energy Midstream Common Units

- Dominion Energy offers Dominion Energy common shares in exchange for outstanding public Dominion Energy Midstream common units

- Fixed exchange ratio reflects a common unit valuation of $17.75, an 8.2 percent premium to the 30-day volume-weighted average unit price

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Dominion Energy

Sep 19, 2018, 16:15 ET

RICHMOND, Va., Sept. 19, 2018 /PRNewswire/ -- Dominion Energy (NYSE: D) today announced that it has made an offer to Dominion Energy Midstream Partners (NYSE: DM) to acquire all outstanding common units not owned by Dominion Energy in exchange for Dominion Energy common shares. The fixed exchange ratio offer of 0.2468 Dominion Energy common shares per Dominion Energy Midstream common unit equates to a per-unit valuation of $17.75, based on closing prices as of Sept. 18, 2018. This represents an 8.2 percent premium to the 30-day volume-weighted average unit price. The transaction is expected to be approximately neutral to Dominion Energy's earnings guidance and credit profile.

It is anticipated that a definitive agreement may be reached in the fourth quarter of 2018, with the transaction closing in the first quarter of 2019.

Thomas F. Farrell, II, Dominion Energy chairman, president and chief executive officer, said:

"Continued weakness in MLP capital markets combined with the prolonged disruption in Dominion Energy Midstream's (DM) common unit price since the March 15 Federal Energy Regulatory Commission policy revision were key factors that led to this decision. Fortunately, Dominion Energy has already successfully completed several steps that will allow us to achieve our earnings and credit objectives despite these challenges. The proposed transaction would provide a premium to recent market trading levels for DM common unit holders and also benefit Dominion Energy shareholders by removing uncertainty as to the future of DM and the potentially negative impact of changes in FERC tax policy to the future cash flows of current DM assets."

If Dominion Energy acquires all of Dominion Energy Midstream's outstanding public common units, Dominion Energy Midstream's Series A Preferred Units are expected to be converted into common units pursuant to Dominion Energy Midstream's partnership agreement and receive the same per-unit consideration as the outstanding public common units at the closing of the transaction.

Dominion Energy's offer is non-binding and has been approved by the board of directors of Dominion Energy. Before Dominion Energy would be in a position to enter into any definitive agreement with Dominion Energy Midstream to effect a proposed transaction, such agreement would need to be reviewed and approved by the boards of directors of Dominion Energy, Inc., and Dominion Energy Midstream GP, LLC. The completion of the proposed transaction will be subject to customary closing conditions, including standard regulatory notifications and approvals.

About Dominion Energy
Nearly 6 million customers in 19 states energize their homes and businesses with electricity or natural gas from Dominion Energy (NYSE: D), headquartered in Richmond, Va. The company is committed to sustainable, reliable, affordable, and safe energy and is one of the nation's largest producers and transporters of energy with over $78 billion of assets providing electric generation, transmission and distribution, as well as natural gas storage, transmission, distribution, and import/export services. As one of the nation's leading solar operators, the company intends to reduce its carbon intensity 50 percent by 2030. Through its Dominion Energy Charitable Foundation, as well as EnergyShare and other programs, Dominion Energy plans to contribute more than $30 million in 2018 to community causes throughout its footprint and beyond.

About Dominion Energy Midstream
Dominion Energy Midstream is a Delaware limited partnership formed by Dominion Energy, Inc., to grow a portfolio of natural gas terminaling, processing, storage, transportation and related assets. It is headquartered in Richmond, Va.

Forward-Looking Statements
his press release contains "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements relate to, among other things, expectations and projections concerning Dominion Energy's offer to acquire Dominion Energy Midstream's outstanding public common units. Actual results may differ from expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as "expect," "assume," "estimate," "project," "anticipate," "intend," "plan," "may," "will," "could," "should," "believe," "potential," and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results, and may include, but are not limited to, statements about the anticipated benefits of the proposed transaction, including future financial and operating results, the attractiveness of the value to be received by the parties to the proposed transaction, Dominion Energy's plans, objectives, expectations and intentions, the timing of future events, the anticipated impact of the transaction on future cash flows, future earnings guidance and credit profile, and descriptions relating to these expectations. All statements relating to events or developments that we expect or anticipate will occur in the future are forward-looking statements, and Dominion Energy's ability to predict results or the actual effect of future events is inherently uncertain. Although Dominion Energy believes that the expectation reflected in any forward-looking statement are based on reasonable assumptions, it can give no assurance that actual outcomes and results will not differ materially from what is expressed in such forward-looking statements. There can be no assurance that the transaction will close.

Forward-looking statements in this release are based on information available as of the date of this release, which such information is subject to change at any time. Dominion Energy undertakes no obligation to update any forward-looking statement to reflect developments after the statement is made.

SOURCE Dominion Energy