ACQUISITION OF ASSETS OF COLUMBIA GAS OF MASSACHUSETTS

9 Months Ended

Sep. 30, 2020

Business Combinations [Abstract]

ACQUISITION OF ASSETS OF COLUMBIA GAS OF MASSACHUSETTS

ACQUISITION OF ASSETS OF COLUMBIA GAS OF MASSACHUSETTS

On October 9, 2020, Eversource acquired certain assets that comprised NiSource’s local natural gas distribution business in Massachusetts, which was previously doing business as CMA, pursuant to an asset purchase agreement (the Agreement) entered into on February 26, 2020 between Eversource and NiSource Inc. The cash purchase price was $1.1 billion plus a target working capital amount, which is subject to adjustment to reflect actual working capital as of the closing date. Eversource financed the asset acquisition through a combination of debt and equity issuances in a ratio that was consistent with our consolidated capital structure. The natural gas distribution assets acquired from CMA were assigned to Eversource Gas Company of Massachusetts, an indirect wholly-owned subsidiary of Eversource formed in 2020. The LNG assets acquired from CMA were assigned to Hopkinton LNG Corp. Eversource Gas Company of Massachusetts distributes natural gas to approximately 330,000 residential, commercial and industrial customers with over 5,000 miles of natural gas distribution pipeline across more than 60 communities in Massachusetts, adding to the approximately 300,000 natural gas customers that Eversource already serves in Massachusetts.

The transaction was approved by the DPU, the Maine Public Utilities Commission, the FERC, and the Federal Communications Commission. The relevant review period under the Hart-Scott-Rodino Act expired. On October 7, 2020, the DPU also approved a rate settlement with the Massachusetts Attorney General’s Office, the DOER, and the Low-Income Weatherization and Fuel Assistance Program Network.

The liabilities assumed by Eversource under the Agreement specifically excluded any liabilities (past or future) arising out of, or related to, the fires and explosions that occurred on September 13, 2018 in Lawrence, Andover and North Andover, Massachusetts related to the delivery of natural gas by CMA, including certain subsequent events, all as described and in the DPU's Order on Scope dated December 23, 2019 (D.P.U. 19-141) (the Greater Lawrence Incident or GLI). The liabilities assumed also excluded any further emergency events prior to the closing of the acquisition related to the restoration and reconstruction with respect to the GLI, including any losses arising out of, or related to, any litigation, demand, cause of action, claim, suit, investigation, proceeding, indemnification agreements or rights. Eversource did not assume any of CMA's or NiSource Inc.'s debt obligations or notes payable.

Due to the limited amount of time between the asset acquisition date and the Company’s filing of its Form 10-Q for the quarter ended September 30, 2020, the initial accounting and development of pro-forma financial information for the asset acquisition are incomplete, and therefore certain disclosures required under business combinations accounting guidance have been omitted.  The Company intends to include these disclosures in its 2020 Annual Report on Form 10-K.