NiSource Announces Cash Tender Offers for Debt Securities

MERRILLVILLE, Ind., Nov. 14, 2011 /PRNewswire/ — NiSource Inc. (NYSE: NI)
announced today that its finance subsidiary, NiSource Finance Corp., has
commenced cash tender offers for two series of its outstanding debt securities.

The tender offers are made pursuant to an Offer to Purchase, dated November 14,
2011 (the “Offer to Purchase”) and related Letter of Transmittal dated November
14, 2011 (the “Letter of Transmittal”), which set forth a comprehensive
description of the terms of the offers. NiSource Finance intends to fund a
portion of the purchase price of the notes accepted in the offers with the net
proceeds from the sale of long-term debt securities in a public offering
announced separately today.

Any and All Offer for 2016 Notes

Upon the terms and subject to the conditions described in the Offer to Purchase,
NiSource Finance is offering to purchase for cash any and all of its outstanding
10.75% Notes due 2016 (“2016 Notes”).

The following table sets forth some of the terms of the Any and All Offer:

Fixed
Title of CUSIP Principal Reference Bloomberg Spread Early
(Basis
Security Number Amount U.S. Treasury Reference Points) Tender
——– —— Outstanding Security Page(1) ——- Payment(2)
——– ——-
10.75%
Notes 1.000% UST
due 2016 65473QAU7 $326,855,000 due 10/31/16 PX1 125 $30
——— ——— ———— ————- — — —

(1) The applicable page on Bloomberg from which the
Dealer Manager will quote the bid side prices of the
applicable Reference U.S. Treasury Security.
(2) Per $1,000 principal amount of notes validly
tendered before 5:00 p.m., New York City time, on
November 22, 2011, not validly withdrawn and accepted
for purchase.

The Any and All Offer is scheduled to expire at 11:59 p.m., New York City time,
on December 12, 2011 (the “Expiration Date”). Holders of 2016 Notes that are
validly tendered on or prior to 5:00 p.m., New York City time, on November 22,
2011 (such time, as it may be extended, the “Early Participation Date”), and not
subsequently validly withdrawn, will receive as consideration for their 2016
Notes an amount which includes an early tender payment. Holders who validly
tender their notes after the Early Participation Date, but before the Expiration
Date, will receive as consideration for their 2016 Notes an amount which does
not include the early tender payment. Tenders of 2016 Notes may be validly
withdrawn at any time up to 5:00 p.m., New York City time, on November 22, 2011
(the “Withdrawal Date”).

The total consideration for each $1,000 principal amount of 2016 Notes validly
tendered and accepted for payment pursuant to the Any and All Offer will be
determined in the manner described in the Offer to Purchase by reference to the
fixed spread over the yield to maturity of the applicable U.S. Treasury Security
specified for the 2016 Notes on the cover page of the Offer to Purchase.

NiSource Finance may, at its option, accept for payment 2016 Notes validly
tendered on or prior to the Early Participation Date at any time after the Early
Participation Date and prior to the Expiration Date (any such date being the
“Early Acceptance Date”). If NiSource Finance elects to have an Early Acceptance
Date, it expects to purchase the 2016 Notes validly tendered and not withdrawn
on or prior to the Early Participation Date promptly following the Early
Acceptance Date (the “Early Settlement Date”).

In addition to the consideration amounts described above, holders whose 2016
Notes are accepted for purchase will receive accrued and unpaid interest up to,
but not including, the applicable settlement date.

Maximum Tender Offer for 2013 Notes

Upon the terms and subject to the conditions described in the Offer to Purchase,
if less than $250 million aggregate principal amount of 2016 Notes are validly
tendered and accepted for purchase in the Any and All Offer, an amount of 6.15%
Notes due 2013 (“2013 Notes”) equal to the difference between $250 million and
the aggregate principal amount of 2016 Notes validly tendered and accepted for
purchase (such difference being the “Maximum Tender Offer Amount”) will be
accepted for purchase. If $250 million or more aggregate principal amount of
2016 Notes are accepted for purchase in the Any and All Offer, the Maximum
Tender Offer will be terminated and no 2013 Notes will be accepted for purchase.

The following table sets forth some of the terms of the Maximum Tender Offer:

Fixed
Title of CUSIP Principal Reference Bloomberg Spread Early
(Basis
Security Number Amount ——— Reference Points) Tender
——– —— Outstanding U.S. Treasury Page(1) ——- Payment(2)
Security ——-
——–
6.15%
Notes 0.625% UST due
due 2013 65473QAK9 $545,000,000 02/28/13 PX4 80 $30
——— ——— ———— ————— — — —

The Maximum Tender Offer is scheduled to expire on the Expiration Date. Holders
of 2013 Notes that are validly tendered on or prior to the Early Participation
Date, and not subsequently validly withdrawn, will receive as consideration for
their 2013 Notes an amount which includes an early tender payment. Holders who
validly tender their notes after the Early Participation Date, but before the
Expiration Date, will receive as consideration for their 2013 Notes an amount
which does not include the early tender payment. Tenders of 2013 Notes may be
validly withdrawn at any time up to the Withdrawal Date.

The total consideration for each $1,000 principal amount of 2013 Notes validly
tendered and accepted for payment pursuant to the Maximum Tender Offer will be
determined in the manner described in the Offer to Purchase by reference to the
fixed spread over the yield to maturity of the applicable U.S. Treasury Security
specified for the 2013 Notes on the cover page of the Offer to Purchase.

If 2013 Notes are accepted for purchase and the aggregate principal amount of
2013 Notes tendered exceeds the Maximum Tender Offer Amount, NiSource Finance
will accept 2013 Notes on a pro rata basis.

In addition to the consideration amounts described above, holders whose 2013
Notes are accepted for purchase will receive accrued and unpaid interest up to,
but not including, the settlement date, which is expected to be one business day
after the Expiration Date.

The offers are subject to the satisfaction or waiver of certain conditions set
forth in the Offer to Purchase, including, among other things, the issuance by
NiSource Finance of at least $500 million aggregate principal amount of two new
series of long-term debt securities in accordance with the terms of the
financing condition more fully described in the Offer to Purchase.

The complete terms and conditions of the offers are set forth in the Offer to
Purchase and the related Letter of Transmittal. Holders of the 2016 Notes and
the 2013 Notes are urged to read these documents carefully before making any
decision with respect to the tender offers.

Questions regarding the tender offers may be directed to the dealer manager,
Citigroup at (212) 723-6106 (collect) or (800) 558-3745 (toll-free). Requests
for documents may be directed to the information agent and depositary, Global
Bondholder Services Corporation at (212) 430-3774 (for banks and brokers) or
(866) 540-1500 (toll-free).

This news release is for informational purposes only and does not constitute an
offer to purchase or a solicitation of an offer to sell with respect to the 2016
Notes or the 2013 Notes, nor is this news release an offer to sell, a
solicitation to buy or an offer to purchase or sell any securities. The tender
offers are being made only pursuant to the Offer to Purchase and related Letter
of Transmittal and only in such jurisdictions as is permitted under applicable
law.

About NiSource

NiSource Inc. (NYSE: NI), based in Merrillville, Ind., is a Fortune 500 company
engaged in natural gas transmission, storage and distribution, as well as
electric generation, transmission and distribution. NiSource operating companies
deliver energy to 3.7 million customers located within the high-demand energy
corridor stretching from the Gulf Coast through the Midwest to New England.
Together, NiSource’s gas transmission and storage companies operate a
15,000-mile network of natural gas pipelines, 37 storage fields and serve some
of the nation’s largest and fastest-growing energy markets in the Northeast,
Midwest and Mid-Atlantic regions. Information about NiSource and its
subsidiaries is available via the Internet at www.nisource.com. NI-F

Forward-Looking Statements

This news release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Those statements include statements
regarding the intent, belief or current expectations of NiSource and its
management. Although NiSource believes that its expectations are based on
reasonable assumptions, it can give no assurance that its goals will be
achieved. Readers are cautioned that the forward-looking statements in this news
release are not guarantees of future performance and involve a number of risks
and uncertainties, and that actual results could differ materially from those
indicated by such forward-looking statements. Important factors that could cause
actual results to differ materially from those indicated by such forward-looking
statements include, but are not limited to, the following: weather; fluctuations
in supply and demand for energy commodities; growth opportunities for NiSource’s
businesses; increased competition in deregulated energy markets; the success of
regulatory and commercial initiatives; dealings with third parties over whom
NiSource has no control; actual operating experience of NiSource’s assets; the
regulatory process; regulatory and legislative changes; the impact of potential
new environmental laws or regulations; the results of material litigation;
changes in pension funding requirements; changes in general economic, capital
and commodity market conditions; and counter-party credit risk, and the matters
set forth in the “Risk Factors” section in NiSource’s 2010 Form 10-K and 2011
Forms 10-Q, many of which risks are beyond the control of NiSource. NiSource
expressly disclaims a duty to update any of the forward-looking statements
contained in this release.