ELKTON — With an eye on Cecil County’s commercial and industrial growth, Chesapeake Utilities Corporation is acquiring Elkton Gas to strengthen its reach to new markets.
Chesapeake Utilities and South Jersey Industries, the parent company of Elkton Gas, announced Monday that they reached an agreement for sale. Pending approval of the Maryland Public Service Commission, the deal is expected to close in 2020.
Chesapeake Utilities is acquiring Elkton Gas for $15 million, according to South Jersey Industries.
“This is an exciting fit and aligns with our company’s growth strategy to identify new investment opportunities to further our future earnings growth,” Chesapeake Utilities Corporation CEO Jeff Householder said in a press statement. “The acquisition of Elkton Gas is significant in that it jumpstarts our current operation, enabling us to more quickly expand our footprint in Cecil County.”
Chesapeake Utilities is based out of Dover, Del., and distributes natural gas throughout Delaware and Maryland’s eastern shore to 79,000 customers in all. The company also owns Eastern Shore Natural Gas Company, an interstate transmission pipeline company that sells gas to Elkton Gas.
In recent years, Chesapeake Utilities expanded into Cecil County, namely to Principio Business Park to reach the manufacturing and distribution centers moving there. These days, Chesapeake Utilities is headed up Route 272 to serve the impending warehouse known as North East Gateway.
Elkton Gas has just under 7,000 customers surrounding the county’s seat, and recently changed hands in summer 2018.
Even with its comparatively low customer base, Elkton Gas will offer Chesapeake Utilities a foothold into the county as it looks at impending development, according to Chesapeake Utilities Vice President Shane Breakie.
“With Elkton Gas in close proximity to the I-95 corridor and the interchange at the western end of the county, this is a first step for the commercial and industrial growth that we see in the foreseeable future,” Breakie said.
Moreover, the proposed Southfields mixed-use development is in Elkton Gas’s service area. With Chesapeake Utilities’ existing relationship with Trammell Crow, the developer of Southfields’ warehouse and the North East Gateway project, Breakie said the company is “perfectly poised” for service whenever Southfields comes online.
Elkton Gas will continue operations with its current staff and out of its office on E. High Street. The key difference is that customers will start to see Elkton Gas employees engage with the town, fitting into Chesapeake Utilities’ culture of community engagement, Breakie said.