TSX:ALA - Post Discussion
Post by
retiredcf on Sep 01, 2023 9:34am
ATB Capital
With its $650-million acquisition of natural gas assets from Tidewater Midstream and Infrastructure Ltd. (TWM-T), ATB Capital Markets’ Nate Heywood raised his target for AltaGas Ltd. to $35 from $34 maintaining an “outperform” rating. The average is $31.47.
“Overall, the transaction should continue to support ALA’s integrated midstream value chain focused on leveraging its unique LPG export position off the West Coast,” said Mr. Heywood. “Consideration for the asset package is $650-million, split between $325-million in cash and $325-million in equity. The assets have the potential to increase EBITDA by $140-million annually through the long term (including synergies and Pipestone Phase II), implying a transaction multiple of 7.2 times. The transaction multiple is accretive to ALA’s 2024 and 2025 multiples near 9.0 times and provides a 0.1-times leverage multiple reduction. We have modeled a $63-million contribution for 2024, which we expect to ramp up in 2025e+ with synergy realization and the Phase II expansion commissioning (modeled to contribute after 2025e).”
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