Southern Company and Kinder Morgan, Inc. today announced a natural gas pipeline venture designed to advance both companies' leadership in energy infrastructure development through Southern Company's acquisition of a 50 percent equity interest in the Southern Natural Gas (SNG) pipeline system. Kinder Morgan will continue to operate the system. In addition, the agreement commits the companies to cooperatively pursue specific growth opportunities to develop natural gas infrastructure for the strategic venture.

SNG is a 7,600-mile pipeline system connecting natural gas supply basins in Texas, Louisiana, Mississippi, Alabama and the Gulf of Mexico to markets in Louisiana, Mississippi, Alabama, Florida, Georgia, South Carolina and Tennessee. SNG is a principal transporter of natural gas to Alabama, Georgia and South Carolina, which are part of one of the fastest-growing natural gas demand regions in the United States.

Southern Company, one of the nation's largest natural gas consumers and distributors, and Kinder Morgan, a recognized leader in natural gas pipeline development and operations, will work together to advance both companies' efforts to develop infrastructure important to America's energy future.

"This transaction is consistent with the infrastructure development strategy we have discussed for well over a year. The company's strategic venture with Kinder Morgan, combined with our recent additions, AGL Resources and PowerSecure, underscore Southern Company's leadership position in electricity and natural gas and our commitment to developing America's energy infrastructure," said Southern Company Chairman, President and CEO Thomas A. Fanning. "Our new ownership stake in SNG will position Southern Company for future growth opportunities and enhanced access to natural gas, which are expected to benefit customers and investors alike."

"Southern Company has been a valued customer of SNG for many years and this agreement draws on the strengths of both companies," said Norman G. Holmes, president of Kinder Morgan South Region Pipelines. "We are very pleased to deepen our relationship with them and excited about the growth opportunities this strategic relationship will provide."

Steve Kean, Kinder Morgan president and chief executive officer, added, "We plan to use all of the proceeds from this transaction to reduce debt at KMI. This is another step towards achieving our stated goals of strengthening our balance sheet and positioning the company for long-term value creation."

Inclusive of existing SNG debt, the transaction equates to an SNG total enterprise value of approximately $4.15 billion which implies a value of $1.47 billion for Southern Company's 50 percent share of the equity interest. Southern Company expects to finance the initial purchase, as well as any related future growth opportunities in a credit-supportive manner.

The transaction is subject to the notification and clearance and reporting requirements under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The companies expect to complete the transaction in the third quarter or early in the fourth quarter of 2016.

Jones Day, Gibson Dunn & Crutcher LLP, Troutman Sanders LLP and Balch & Bingham LLP are serving as legal counsel to Southern Company, and Bracewell LLP and Weil, Gotshal & Manges LLP are serving as legal counsel to Kinder Morgan.

Southern Company Unveils New Brand

As Southern Company expands its business model to increase its natural gas presence, the company today unveiled a new corporate brand. The company also announced that its newest subsidiary, AGL Resources, has been renamed Southern Company Gas.

"Southern Company's recent growth in natural gas has expanded our business beyond electricity, providing an excellent opportunity to review our brand," said Southern Company Chairman, President and CEO Thomas A. Fanning. "By adding Southern Company Gas while developing the full energy portfolio, Southern Company has doubled its customer base, expanded its footprint and broadened the scope of our business. Today we are a leading national energy company that is better positioned to deliver real solutions for customers."

Southern Company's electric utilities have served customers and communities in the Southeast for more than a century. With the recent merger with Southern Company Gas, the Southern Company system now operates in 18 states, serving more than 9 million customers, with a continued focus on creating real energy solutions to deliver clean, safe, reliable and affordable power.

Southern Company Gas is helping the Southern Company system best meet customers' energy needs today while providing for the development of tomorrow's energy infrastructure. For communities, the combined company is expanding its customer-focused business model. And for investors, the merger created a unique platform that is well-positioned to compete for growth across the energy value chain.

In addition, Southern Company recently acquired PowerSecure, a leader in distributed infrastructure development that specializes in the kinds of customer-facing energy solutions that are becoming increasingly important to many customers across America.

Southern Company's new brand represents the first design change in more than 20 years and is the result of research conducted by engaging employees, company leaders and other stakeholders as part of an extensive brand review.