Sempra plans $3 billion of debt, further debt for Oncor acquisition

New York, Aug. 21 – Sempra Energy plans to issue $3 billion of investment-grade debt via the reorganized Energy Future Holdings Corp. and to issue additional debt and equity to help fund its acquisition of Energy Future.

The company has financing commitments from RBC Capital Markets and Morgan Stanley for the transaction according to a news release.

Sempra said on Monday that it has agreed to acquire Energy Future, which owns 80% of Oncor Electric Delivery Co., LLC and is reorganizing under Chapter 11.

The purchase price is $9.45 billion in cash.

Including the assumption of Oncor’s debt, the enterprise value of the acquisition is $18.8 billion.

To fund the transaction, Sempra will use its own debt and equity, third-party equity and $3 billion of investment-grade debt at the reorganized holding company.

Oncor’s credit ratings are expected to improve through the merger, Sempra said.

Sempra will own 60% of the reorganized holding company after closing.

Completion is planned for the first half of 2018.

Sempra is a San Diego-based energy services company.

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