Sempra Energy’s $9.45 billion Acquisition of Energy Future Holdings Corp.

White & Case LLP has advised Sempra Energy (NYSE:SRE) on its approximately US$9.45 billion all-cash acquisition of Energy Future Holdings Corp. (“EFH”) and its subsidiary, Energy Future Intermediate Holding Company (“EFIH”, and together with EFH, the “EFH Debtors”), the indirect owners of approximately 80 percent of Oncor Electric Delivery Company, LLC (“Oncor”), the largest utility in Texas.

The deal, which valued Oncor at approximately US$18.8 billion at signing, closed on Friday and brings an end to the EFH Debtors’ long-running chapter 11 case. The case, which has been pending for nearly four years and has seen two prior confirmed plans fail to consummate because of regulatory issues, was the largest industrial bankruptcy in US history.

White & Case was retained by Sempra Energy last July to assist it in developing a proposal that would be superior to the one reflected in the EFH Debtors’ agreement to merge with Berkshire Hathaway Energy (“BHE”), which was set to be approved by the US Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) in mid-August. A series of around-the-clock negotiations produced a Sempra Energy proposal that the boards of EFH and EFIH determined to be superior and that creditors holding the vast majority of the debt of EFH and EFIH agreed to support.

On August 21, 2017, the EFH Debtors terminated their agreement with BHE and accepted the Sempra Energy proposal. The EFH Debtors obtained Bankruptcy Court authority to proceed with the Sempra Energy transaction on September 6, subject to obtaining all required regulatory approvals and confirmation of their chapter 11 plan.

Over the ensuing six months, Sempra Energy obtained all required regulatory approvals, including from the Public Utility Commission of Texas (the “PUCT”), whose rulings with respect to two prior proposals to acquire the EFH Debtors’ 80 percent stake in Oncor had resulted in those transactions not closing. In early February, the parties announced that they had obtained the support of all intervenors through a settlement in the PUCT proceeding, including the PUCT staff. The Bankruptcy Court confirmed the chapter 11 plan for the EFH Debtors on February 26, and the PUCT approved the transaction on March 8, paving the way for the deal to close, which makes Sempra Energy the largest utility holding company in the US as measured by customer base.

Headquartered in Dallas, Texas, Oncor is a regulated electric transmission and distribution service provider, serving more than 11 million Texans.

Sempra Energy is a Fortune 500 energy services holding company based in San Diego, California, with 2017 revenues of more than US$11 billion. Including Oncor, the Sempra Energy companies’ approximately 20,000 employees serve 43 million consumers worldwide. Sempra Energy includes San Diego Gas & Electric, Southern California Gas Company, Sempra South American Utilities, Sempra Mexico, Sempra Renewables, Sempra LNG & Midstream and a majority stake in Oncor.

Sempra Energy is an energy services holding company with operations throughout the United States, Mexico, and other countries in South America. The company, led by Debra L Reed, Kevin Chase, Erbin B Keith, in 2017 recorded $11.207 Billion Revenues.

The White & Case team that advised on the transaction was co-led by partners Thomas Lauria (Picture), Gregory Pryor, Christopher Shore and Eric Leicht, who were assisted by partners Matthew Brown, Michael Deyong, David Dreier, Daniel Hagan, Henrik Patel and Andrew Weisberg, and associates Adam Cieply, Alexandra Tremblay, Joseph Pack, Jason Woolmer, John Forbush and Shea Thompson.


Involved fees earner: Gregory Pryor – White & Case; Michael Deyong – White & Case; David Dreier – White & Case; Andrew Weisberg – White & Case; Adam Cieply – White & Case; Thomas Lauria – White & Case; Chris Shore – White & Case; Matthew Brown – White & Case; Joseph Pack – White & Case; Eric Leicht – White & Case; Daniel Hagan – White & Case; John Forbush – White & Case; Shea Thompson – White & Case; Henrik Patel – White & Case;

Law Firms: White & Case;

Clients: Sempra Energy;



Author: Ambrogio Visconti