NextEra Agreed to Buy Energy Future’s Oncor in a $18.4 Billion Deal

NextEra Energy, Inc. (NYSE: NEE), a leading clean energy company headquartered in Florida, announced on Friday that it reached a definitive agreement to acquire 100% of the equity of Energy Future Holding, including Energy Future Holding’s 80% indirect interest in Oncor Electric Delivery Company. The whole deal implies a total enterprise value of approximate $18.4 billion.

The definitive agreement belongs to the plan of reorganization of Energy Future Holding who filed for chapter 11 bankruptcy protection in 2014 due to the financial problems caused by a buyout deal in 2007 and sharply unexpected drop of gas price. NextEra Energy’s transaction will extinguish all Energy Future Holdings and Energy Future Intermediate Holding Company debt that currently exists above Oncor, according to the announcement.

“We are incredibly impressed by Oncor’s management team and its employees, and we are committed to retaining the Oncor name, its Dallas headquarters and local management,” chairman and chief executive officer of NextEra Energy, Jim Robo said, “NextEra Energy shares Oncor’s strategy of making smart, long-term investments in transmission and distribution to continue to deliver affordable, reliable electric service to its customers. We look forward to working closely with Oncor’s leadership team and filing our joint application with the Public Utility Commission of Texas.”

NextEra Energy may use a combination of debt, convertible equity units, and proceeds from asset sales to fund cash being provided to creditors. Just after the deal release on Friday, NextEra Energy Resources, LLC, subsidiary of NextEra Energy, Inc. announced to sell its ownership interest in Marcus Hook generating assets to an investment affiliate of Starwood Energy Group Global, LLC. NextEra Energy expects the transaction to be completed in the first quarter of 2017 and to be meaningfully accretive to earnings.

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