Chesapeake Utilities Corporation Expands its Footprint into the Carolinas with Propane Acquisition

Rhea-AI Summary

Chesapeake Utilities Corporation (NYSE: CPK) has announced the acquisition of propane operating assets from Diversified Energy Company, allowing its subsidiary Sharp Energy to expand into North and South Carolina. This strategic move adds approximately 19,000 new customers and potential annual propane distribution of 10 million gallons. The acquisition is expected to positively impact earnings, contributing an estimated $11.3 million in gross margin for 2022. This growth aligns with Sharp Energy's goal to strengthen its market presence along the East Coast.

Positive

• Acquisition adds approximately 19,000 new customers and distribution of 10 million gallons of propane annually.
• Expected to contribute approximately $11.3 million in gross margin for 2022.

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• None.

DOVER, Del., Dec. 15, 2021 /PRNewswire/ -- Chesapeake Utilities Corporation (NYSE: CPK) announced today that its propane subsidiary, Sharp Energy, has acquired the propane operating assets of Diversified Energy Company. Through this acquisition, the Company expands its operating footprint into North Carolina and South Carolina.

"Sharp Energy has driven significant growth for Chesapeake Utilities as a market leader in residential, commercial, wholesale and AutoGas propane services. Propane remains a core part of our unregulated energy operations given its high demand, especially in more rural areas where natural gas pipelines cannot or have not yet reached," said Jeff Householder, president and chief executive officer, Chesapeake Utilities. "The addition of Diversified Energy's propane business expands Sharp's footprint into the Carolinas, adding to our growing presence along the East Coast. We are pleased to welcome our new employees to the Chesapeake Utilities family and are committed to serving Sharp's new customers with a continued commitment to excellence, integrity and care." 

"We believe the two organizations align culturally, and we are excited to integrate the Diversified Energy business into Sharp Energy," said Andy Hesson, vice president of Sharp Energy. "With this transaction, our propane business will add approximately 19,000 residential, commercial and agricultural customers, along with distribution of approximately 10 million gallons of propane annually."

The deal is expected to be accretive to Chesapeake Utilities' 2022 earnings, adding approximately $11.3 million in gross margin for 2022. 

About Chesapeake Utilities Corporation
Chesapeake Utilities Corporation is a diversified energy delivery company, listed on the New York Stock Exchange, which is engaged in natural gas transmission and distribution; electricity generation and distribution; propane gas distribution; mobile compressed natural gas (CNG) utility services and solutions; and other businesses. Information about Chesapeake Utilities Corporation's businesses is available at www.chpk.com and on the Annual Report Microsite at cpkannualreport.com.

About Sharp Energy
Sharp Energy, headquartered in Georgetown, Delaware, distributes propane to residential, commercial and industrial customers in Maryland, Delaware, Virginia and Pennsylvania. With multiple rail facilities and several millions of gallons of propane storage, Sharp Energy has established a solid supply portfolio. Sharp Energy is a proud partner of Alliance AutoGas, a national network of companies that have joined together to deliver a comprehensive alternative fueling solution including EPA-certified propane AutoGas vehicle conversions, on-site fueling infrastructure, fuel supply, safety and operational training, and ongoing technical support. To learn more about Sharp Energy, visit www.sharpenergy.com.

Please note that Chesapeake Utilities Corporation is not affiliated with Chesapeake Energy, an oil and natural gas exploration company headquartered in Oklahoma City, Oklahoma.

For more information, contact:
Media Relations:
Brianna Patterson
Manager, Public Relations and Strategic Communications
bpatterson@chpk.com
302.217.7050

Investor Relations:
Alex Whitelam
Head of Investor Relations
awhitelam@chpk.com
215.872.2507

View original content:https://www.prnewswire.com/news-releases/chesapeake-utilities-corporation-expands-its-footprint-into-the-carolinas-with-propane-acquisition-301445966.html

SOURCE Chesapeake Utilities Corporation

FAQ

What is the significance of Chesapeake Utilities' acquisition of Diversified Energy Company?

The acquisition allows Chesapeake Utilities' subsidiary Sharp Energy to expand its operations into North and South Carolina, increasing its customer base and distribution capacity.

How many customers will Sharp Energy gain from the Diversified Energy acquisition?

Sharp Energy will gain approximately 19,000 new residential, commercial, and agricultural customers from the acquisition.

What is the expected financial impact of the acquisition on Chesapeake Utilities in 2022?

The acquisition is expected to add approximately $11.3 million in gross margin to Chesapeake Utilities' earnings for 2022.

When was the acquisition of Diversified Energy Company announced?

The acquisition was announced on December 15, 2021.

What are the main products and services offered by Sharp Energy?

Sharp Energy provides propane distribution for residential, commercial, and industrial customers.