On the Nonutility side, as you’ll recall, at the beginning of 2011 we outlined our strategy for our Nonutility portfolio businesses, which included a focus on growing our infrastructure services and energy services businesses in order to reduce the reliance on earnings growth from our commodity sensitive businesses.
Consistent with that strategy, in late March we announced the acquisition of Minnesota Limited, a complementary addition to Miller Pipeline in our Infrastructure Services segment. The addition of Minnesota Limited contributed $0.11 per share, well above our initial expectations of $0.02 to $0.04 of EPS. I’ll discuss this further in just a few minutes.
To close the year, we sold Vectren Source, our retail gas marketing company, for proceeds of approximately $84 million and an estimated gain of $12.4 million net of all tax effects. Both amounts are subject to final adjustment for working capital. We believe this is the right time to move forward with the sale of Vectren Source and realize the value in this business that was built from the ground up over the last several years. We found a logical buyer in Direct Energy that is already an active participant in the retail energy markets and is willing to put additional capital to work to continue to grow the business.
The sale of Source coupled with the acquisition of Minnesota Limited has helped to reduce our earnings exposure to the more volatile commodities markets, again consistent with the strategy we discussed at the beginning of 2011. In addition, it demonstrates Vectren’s disciplined approach to regularly assessing each of our Nonutility businesses to determine whether they continue to be a strategic fit for Vectren.We also highlighted a couple of specific items beyond normal growth expected in our various businesses to help offset the loss of the Source earning stream for 2012 and beyond. 2011 also saw the ramp-up of production at our new Oaktown 1 mine, which produced 2.7 million tons of coal for the year and is approaching its full capacity of approximately 3 million tons. In addition, we continued the development of the second Oaktown mine, with a targeted startup in the third quarter of 2012 depending upon demand. Read the rest of this transcript for free on seekingalpha.com
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV