Sempra Energy, the California-based energy company, announced this Monday it has entered into a definitive agreement to sell its non-controlling interest in its new business platform, Sempra Infrastructure Partners (SIP), to the funding firm KKR for $3,37 billion in cash.
Firstly, the transaction values Sempra’s platform, Sempra Infrastructure Partners, at approximately $25,2 billion, including a debt from operated assets of $8,37 billion.
Secondly, this announcement is a part of a series of agreements that Sempra arranged back in December, 2020. Such agreements intend to simplify the company’s non-utility infrastructure investments under one self-funding platform. This platform will combine the strengths of Sempra LNG and IEnova.
Thirdly, by this transaction, SIP would allow Sempra to unlock portfolio synergies, highlight value and better position the business for growth. The companies expect the transaction will be completed by mid-2021, as it is still subject to regulatory approvals.
On the other hand, KKR will be purchasing Sempra’s share in SIP through its Global Infrastructure Investors Funds; since its inception in 2008, the fund has allowed KKR to acquire more than $27 billion in infrastructure assets, and over 40 investments across the energy industry.
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Sempra Energy to expand in North America
In addition, Jeffrey W. Martin, chairman and CEO of Sempra Energy, said. “Over the next decade, we expect the energy markets in North America to continue to grow and become increasingly integrated. Combining our resources with KKR improves our ability to capture new investment opportunities in cleaner forms of energy; also, in the critical infrastructure that stores and transports it.”
He also remarked. “This transaction also sends a clear signal about the value and expected growth of our infrastructure portfolio.”
Moreover, Raj Agrawal, KKR Partner and Global Head of Infrastructure. Stated. “Investing in critical new energy infrastructure creates jobs; also, delivers reliable energy with fewer emissions and supports North America’s economic recovery.”
Finally, he underlined. “We are excited to partner with Sempra Energy. This infrastructure platform provides a strong foundation to expand cleaner energy resources across the continent. Backed by strong, long-term cash flows, our investment is also consistent with KKR Infrastructure’s strategy to seek stable and predictable returns for our investors.”