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El Paso/Coastal deal OK'd
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January 29, 2001: 4:30 p.m. ET
FTC clears way for merger creating fourth-largest U.S. energy firm
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NEW YORK (CNNfn) - The Federal Trade Commission approved Monday El Paso Energy Corp.'s $16.5 billion acquisition of Coastal Corp., removing the final hurdle for the merger creating the fourth-largest U.S. energy company.
El Paso (EPG: Research, Estimates), which owns the largest natural gas pipeline in America, announced a deal to swap 1.23 shares of its stock for each outstanding Coastal share in January 2000.
In order to obtain FTC approval, Houston-based El Paso agreed to divest ownership in five pipeline systems. The company plans to use the expected $243 million proceeds from these sales to pay down debt and the sales are not expected to affect earnings.
In July, the Federal Energy Regulatory Commission approved the deal, saying it would not harm competition.
Shares of El Paso rose 16 cents to $63.10, while Coastal (CGP: Research, Estimates) jumped $2.50 to $79.50. 
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