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Sempra Energy revises financial structure to acquire re-structured EFH [free access]

October 4, 2017

Sempra Energy Inc. has revised the financial structure of its USD9.45 billion proposal to acquire the restructured Energy Future Holdings Corporation (EFH), the indirect owner of 80 per cent stake in Oncor Electric Delivery Company, LLC (Oncor) — operator of the largest electric transmission and distribution system in Texas.


Sempra Energy expects to fund approximately 65 per cent of the USD9.45 billion purchase price with its equity and 35 per cent with its debt. This simpler and more conservative financing approach will eliminate the EFH debt, as well as third-party equity, enabling Sempra Energy to purchase 100 per cent of EFH at the close of the transaction. Sempra Energy's original proposal was to initially acquire 60 per cent of EFH, with the goal of acquiring 100 per cent over a period of time.


On August 21, Sempra Energy entered into an agreement to acquire EFH, and on September 6, the US Bankruptcy Court for the District of Delaware approved the acquisition deal. The agreement remains subject to customary closing conditions, including further approvals by the Bankruptcy Court, the Public Utility Commission (PUC) of Texas (PUCT), and the Federal Energy Regulatory Commission (FERC).


Sempra Energy and Oncor are likely to jointly file a change-in-control application soon with PUCT.