History of Southern Union Southern Union's history dates back to the 1920s as a holding company for several gas utilities in Texas. Over the next six decades the company expanded its gas supply operations and diversified into natural gas processing, exploration and production, refining, gas appliance sales and real estate. This diversification strategy failed, and in the late 1980s SUG divested everything except its natural gas distribution business. In 1990 Southern Union was acquired by the mobile telephone company Metro Mobile, Inc; however, the resulting entity took the name Southern Union. The mobile operations would eventually be sold to Bell Atlantic, and SUG would refocus on its natural gas distribution business acquiring more than 1.5 million customers through acquisitions in Missouri and the Northeast. In 2002, the company changed course again by deciding to divest most of its gas distribution business and use the proceeds to expand into interstate pipelines. SUG acquired Panhandle Energy for $1.8 billion in 2002 and its 50% stake in Citrus Corp, which owns Florida Gas Transmission, in 2006. Diversification continued when SUG acquired the gas gathering and processing company natural gas, Sid Richardson, for $1.6 billion. See the appendix for a map of Southern Union's current operations. Transportation and Storage (forecast as 57 percent of 2009 EBITDA) This segment consists of three natural gas pipelines: Panhandle Eastern, Trunkline and Sea Robin, a natural gas and the LNG Terminal of the backbone. The three pipelines have a total length of approximately 10,000 miles and transport 5.5 billion cubic feet/day of natural gas. The Panhandle Eastern pipeline transports natural gas from the Rocky Mountains and Midcontinent supply areas to...... middle of the paper...... of revenues was Louis Dreyfus Energy Services (average contract length is 5 .8 years) while the remaining top ten customers accounted for another 49% of revenues. Distribution (forecast as 12% of 2009 EBITDA) The distribution sector consists of two local natural gas distribution companies. Missouri Gas Energy serves 500,000 customers in Missouri, including Kansas City. New England Gas Company serves 50,000 customers in Massachusetts. Missouri Gas Energy has decoupled volumes for its residential customers and small general utility customers, creating more stable earnings. A recent rate case set an allowable ROE of 10% and approved a rate increase of $16 million effective February 28, 2010. Other (expected as 1% of 2009 EBITDA) A generic category covering the enterprise segment , PEI power (70 MW of generation assets in PJM), and a legacy gas appliance business.