August 13, 2008
EFH Announces Sale of Approximate 20 Percent Minority Interest in Oncor
Energy Future Holdings Corp. (EFH) today announced the agreement to sell an approximate 20 percent minority ownership interest in Oncor Electric Delivery Company LLC to an investor group led by Borealis Infrastructure Management (Borealis), an investment arm of the OMERS pension plan, and GIC Special Investments (GIC SI).
"The sale of a minority interest to these investors fulfills an important transaction related commitment and will enhance Oncor's financial separation from other EFH businesses," said John Young, EFH CEO.Borealis manages OMERS infrastructure investments and has been a world leader in developing infrastructure investing as an asset class for institutional investors. OMERS is one of Canada's largest pension plans, with more than $52 billion invested in a wide range of companies and assets around the world. OMERS provides retirement benefits to 380,000 members across Ontario. GIC SI is the private equity and infrastructure arm of the Government of Singapore Investment Corporation (GIC). GIC was established in 1981 as a global investment company to manage Singapore's foreign reserves, which now stand at more than $100 billion. GIC SI is one of the world's largest and most well-respected private equity investors, and an established player in the infrastructure market, with a long-term buy and hold strategy in companies all over the world, including the U.S.
Under the agreement, the investor group will pay approximately $1.254 billion for an approximate 19.75 percent minority interest in Oncor and will have the right to add two directors to Oncor's board of directors. A majority of Oncor's directors will remain independent.
"We are pleased that Borealis and GIC SI see Oncor as a solid, long-term investment," said Bob Shapard, Chairman and CEO of Oncor. "This transaction will not affect our employees or the service we provide to more than 7 million Texas consumers. Our dedicated employees will continue to provide superior reliability while deploying one of the most advanced utility technology platforms in the country."
Among other conditions necessary for closing, the transaction will be reviewed by the Committee on Foreign Investment in the United States, and will only close once that process is complete.
Credit Suisse acted as financial advisor to EFH and Lehman Brothers acted as financial advisor to the investor group in connection with the transaction.
Energy Future Holdings Corp. is a Dallas-based energy holding company, with a portfolio of competitive and regulated energy subsidiaries, primarily in Texas, including TXU Energy, Luminant and Oncor. TXU Energy is a competitive retailer that provides electricity and related services to 2.1 million electricity customers in Texas. Luminant is a competitive power generation business, including mining, wholesale marketing and trading, construction and development operations. Luminant has over 18,300 MW of generation in Texas, including 2,300 MW of nuclear and 5,800 MW of coal-fueled generation capacity. Luminant is also the largest purchaser of wind-generated electricity in Texas and fifth largest in the United States. Oncor is a regulated electric distribution and transmission business that uses superior asset management skills to provide reliable electricity delivery to consumers. Oncor operates the largest distribution and transmission system in Texas, providing power to three million electric delivery points over more than 102,000 miles of distribution and 14,000 miles of transmission lines. While Oncor is a subsidiary of EFH, Oncor reports to a separate and independent board. Visit www.energyfutureholdings.com for more information.