Southern Company Announces Sale of Certain Florida Assets to NextEra Energy
Tuesday, May 22nd, 2018
Southern Company today announced that it has entered into agreements to sell Gulf Power Company, Florida City Gas and the entities holding Southern Power's interests in Plant Oleander and Plant Stanton to NextEra Energy for an aggregate purchase price of approximately $6.475 billion. Net of debt, this reflects an equity value of approximately $5.075 billion.
"This sale provides Southern Company the opportunity to deliver great value to our organization, bolster our financial profile and continue to build the future of energy as one of America's premier energy companies," said Thomas A. Fanning, chairman, president and CEO of Southern Company. "These Florida businesses are being sold at a price that provides substantial value to our stockholders, while entrusting the customers of these exceptional franchises to a high-quality utility company that has a well-established presence in the state."
The transactions are designed to allow Gulf Power and Florida City Gas to continue their customer-focused business models and strong commitments to safety, reliability, customer service and community engagement.
Proceeds from these transactions are intended to be used to reduce debt and improve Southern Company's balance sheet. Southern Company's goal remains to simultaneously provide benefits to customers, preserve solid credit metrics and improve the contribution of its state-regulated utilities to its value proposition. The opportunity to fund the business without raising significant additional capital makes the value proposition of these transactions even stronger.
Completion of each of these transactions is conditioned upon, among other things, the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The Gulf Power and Plant Oleander and Plant Stanton transactions also will require approval by the Federal Energy Regulatory Commission and the Federal Communications Commission. The target completion for the sales of Gulf Power and Southern Power's interests in Plant Stanton and Plant Oleander is the first half of 2019. The Florida City Gas transaction's target completion is third quarter 2018.