JUNO BEACH, Fla., Oct. 31, 2016 /PRNewswire/ -- NextEra
Energy, Inc. (NYSE: NEE) today announced it has reached an
agreement for an affiliate to merge with Texas Transmission
Holdings Corporation ("TTHC"), including TTHC's approximately 20
percent indirect interest in Oncor Electric Delivery Company LLC
("Oncor"), for merger consideration of approximately $2.4 billion, subject to adjustment. In addition,
NextEra Energy has reached an agreement to acquire the remaining
0.22 percent interest in Oncor that is owned by Oncor Management
Investment LLC ("OMI") for total cash consideration of
approximately $27 million. If
approved, these transactions, when combined with NextEra Energy's
previously announced transaction to acquire Energy Future Holdings
Corp.'s ("EFH") approximately 80 percent interest in Oncor, would
result in NextEra Energy owning 100 percent of Oncor.
"We are very pleased to have reached an agreement for one of our
affiliates to merge with TTHC, including its approximately 20
percent indirect interest in Oncor," said Jim Robo, chairman and chief executive officer
of NextEra Energy. "We appreciate TTHC's commitment to reaching
this agreement and believe this transaction further affirms our
long-term commitment to partnering with Oncor for the benefit of
its customers and the state of Texas. We, together with Oncor, look forward
to filing our joint application by Nov.
1 with the Public Utility Commission of Texas seeking approval of our proposed
acquisition of Oncor."
Rhys Evenden, Head of
Infrastructure (North America),
GIC, said, "As a long-term investor GIC is proud to be associated
with Oncor, a like-minded partner whose focus on discipline and
value puts it in good stead for the future. We wish the company and
its highly dedicated team every success."
"For the past eight years, OMERS has greatly valued our
relationship with Oncor's employees, management team, customers,
regulators and our fellow investors. Oncor has been an important
investment for OMERS helping us to create long-term value for our
active and retired members. Oncor is one of the top performing
utilities in the nation and with the support of NextEra Energy, we
are confident that the company will continue to provide reliable
and affordable electric service to its customers and the state of
Texas," said Ralph Berg, Executive Vice President &
Global Head of Infrastructure, OMERS Private Markets.
"We're appreciative of the important role our minority investor
has played during the past eight years," said Bob Shapard, CEO of Oncor. "As both shareholders
and board members, their support has been key to our ability to
navigate what has been a financially challenging period for EFH. If
the current proposal is approved, looking forward, Oncor will be
backstopped by a very strong balance sheet and will have
a partner in NextEra Energy that is committed to continuing
our efforts to build a safer, smarter, more reliable electric
grid."
Transaction details
Under the terms of the TTHC merger agreement, NextEra Energy
will pay 100 percent of the merger consideration in cash. As a
result of the transaction, no debt will reside at TTHC or Texas
Transmission Investment LLC ("TTI") upon close of the merger.
NextEra Energy expects to fund the merger consideration through a
combination of debt and equity, consistent with the company's
commitment to maintaining its strong balance sheet and credit
ratings. The transaction is not subject to any financing
contingencies.
NextEra Energy expects that its transactions with EFH, TTHC and
OMI, which would result in its 100 percent ownership of Oncor, if
approved, would be meaningfully accretive to earnings, enabling the
company to grow at or near the top end of its previously announced
6 percent to 8 percent per year adjusted earnings per share growth
rate through 2018, off a 2014 base. The transactions are consistent
with NextEra Energy's focus on investing in regulated and long-term
contracted assets and leverage many of the company's core
competencies, including investing smartly to improve operations,
creating long-term value for both customers and shareholders.
NextEra Energy remains committed to maintaining its strong balance
sheet and expects that its credit ratings and its subsidiaries'
credit ratings will be maintained post-closing.
Approvals
The TTHC merger agreement contemplates approval by the Public
Utility Commission of Texas.
NextEra Energy, together with Oncor, expects to file by
Nov. 1 a joint application for merger
approval. The proposed TTHC transaction is also subject to approval
by the Federal Energy Regulatory Commission, the expiration or
termination of the waiting period under the Hart-Scott-Rodino Act,
the receipt of any required third-party approvals and other
customary closing conditions. NextEra Energy expects the TTHC
transaction, which has been approved by the boards of directors of
both NextEra Energy and TTHC, and the TTHC shareholders, to be
completed in the first half of 2017. The completion of the other
transactions also is subject to conditions specified in the
definitive agreements for those transactions.
Advisors
Credit Suisse Securities (USA)
LLC and Bank of America Merrill Lynch are serving as lead financial
advisors to NextEra Energy. Chadbourne & Parke LLP is serving
as lead legal counsel to NextEra Energy.
NextEra Energy, Inc.
NextEra Energy, Inc. (NYSE: NEE) is a leading clean energy
company with consolidated revenues of approximately $17.5 billion and approximately 14,300 employees
in 27 states and Canada as of
year-end 2015, as well as approximately 45,000 megawatts of
generating capacity, which includes megawatts associated with
noncontrolling interests related to NextEra Energy Partners, LP
(NYSE: NEP) as of April 2016.
Headquartered in Juno Beach, Fla.,
NextEra Energy's principal subsidiaries are Florida Power & Light Company, which serves
more than 4.8 million customer accounts in Florida and is one of the largest
rate-regulated electric utilities in the
United States, and NextEra Energy Resources, LLC, which,
together with its affiliated entities, is the world's largest
generator of renewable energy from the wind and sun. Through its
subsidiaries, NextEra Energy generates clean, emissions-free
electricity from eight commercial nuclear power units in
Florida, New Hampshire, Iowa and Wisconsin. A Fortune 200 company and included
in the S&P 100 index, NextEra Energy has been recognized often
by third parties for its efforts in sustainability, corporate
responsibility, ethics and compliance, and diversity, and has been
ranked No. 1 in the electric and gas utilities industry in
Fortune's 2016 list of "World's Most Admired Companies." For more
information about NextEra Energy companies, visit these websites:
www.NextEraEnergy.com, www.FPL.com,
www.NextEraEnergyResources.com.
Texas Transmission Holdings Corporation ("TTHC")
TTHC is a holding corporation which owns an approximate 20
percent indirect interest in Oncor Electric Delivery Company LLC.
TTHC is owned indirectly by a group of investors, including OMERS,
one of Canada's largest pension
plans and GIC, Singapore's
sovereign wealth fund. TTHC owns 100 percent of Texas Transmission
Investment LLC, which owns a 19.75 percent interest in Oncor.
Forward-Looking Statements
This document contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are typically identified by words or
phrases such as "may," "will," "anticipate," "estimate," "expect,"
"project," "intend," "plan," "believe," "predict," and "target" and
other words and terms of similar meaning. Forward-looking
statements involve estimates, expectations, projections, goals,
forecasts, assumptions, risks and uncertainties. NEE cautions
readers that any forward-looking statement is not a guarantee of
future performance and that actual results could differ materially
from those contained in any forward-looking statement. Such
forward-looking statements include, but are not limited to,
statements about the anticipated benefits of the proposed
transactions involving NEE, EFH, TTHC, OMI and Oncor, including
future financial or operating results of NEE or Oncor, NEE's, EFH's
or Oncor's plans, credit ratings changes, objectives, expectations
or intentions, the expected timing of completion of the
transactions, the value, as of the completion of the EFH merger,
the TTHC merger or the acquisition of OMI's interest in Oncor, or
as of any other date in the future, of any consideration to be
received in the EFH merger in the form of stock or any other
security, NEE's earnings expectations and other statements that are
not historical facts. Important factors that could cause actual
results to differ materially from those indicated by any such
forward-looking statements include risks and uncertainties relating
to: the risk that NEE, EFH, TTHC, OMI or Oncor may be unable to
obtain bankruptcy court and governmental and regulatory approvals
required for the transactions, or required bankruptcy court and
governmental and regulatory approvals may delay the transactions or
result in the imposition of conditions that could cause the parties
to abandon any or all transactions; the risk that a condition to
closing of any of the transactions may not be satisfied; the
expected timing to consummate the proposed transactions; the risk
that the businesses will not be integrated successfully; disruption
from the transactions making it more difficult to maintain
relationships with customers, employees or suppliers; the diversion
of management time and attention on merger-related issues; general
worldwide economic conditions and related uncertainties; the effect
and timing of changes in laws or in governmental regulations
(including environmental); fluctuations in trading prices of
securities of NEE and in the financial results of NEE, EFH or Oncor
or any of their subsidiaries; the timing and extent of changes in
interest rates, commodity prices and demand and market prices for
electricity; and other factors discussed or referred to in the
"Risk Factors" section of Oncor's or NEE's most recent Annual
Reports on Form 10-K filed with the Securities and Exchange
Commission. These risks, as well as other risks associated with the
transactions, will be more fully discussed in subsequent filings
with the SEC in connection with the mergers. Additional risks and
uncertainties are identified and discussed in NEE's and Oncor's
reports filed with the SEC and available at the SEC's website at
www.sec.gov. Each forward-looking statement speaks only as of the
date of the particular statement and NEE does not undertake any
obligation to update or revise its forward-looking statements,
whether as a result of new information, future events or
otherwise.
NextEra Energy, Inc.
Media Line: (561) 694-4442
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SOURCE NextEra Energy, Inc.