Summary
This Form 8-K filing from CenterPoint Energy Inc. (CNP) announces a significant development in its midstream energy holdings. On February 16, 2021, CenterPoint Energy, along with OGE Energy Corp., entered into a Merger Agreement with Energy Transfer LP, whereby Energy Transfer will acquire 100% of Enable Midstream Partners, LP. This transaction represents a strategic divestiture for CenterPoint Energy, as it will exchange its interest in Enable for Energy Transfer common units, cash, and preferred units. The deal is anticipated to close in the second half of 2021, subject to regulatory approvals and other customary closing conditions.
Key Highlights
- 1CenterPoint Energy (CNP) is participating in the sale of Enable Midstream Partners, LP to Energy Transfer LP.
- 2The transaction involves Energy Transfer acquiring 100% of Enable's outstanding equity interests.
- 3CNP will receive Energy Transfer common units, $5 million cash for its interest in EnableGP, and approximately $385 million of Energy Transfer Series G Preferred Units in exchange for its Enable Series A Preferred Units.
- 4The exchange ratio for Enable common units owned by CNP is 0.8595 Energy Transfer common units per Enable common unit.
- 5The transaction is expected to be completed in the second half of 2021.
- 6Closing is contingent upon customary conditions, including antitrust clearance (Hart-Scott-Rodino).
- 7CNP and OGE have entered into support agreements to facilitate the merger, agreeing to vote their Enable units in favor of the transaction and refrain from soliciting other acquisition proposals.
Frequently Asked Questions
The primary purpose is to announce CenterPoint Energy's entry into an Agreement and Plan of Merger with Energy Transfer LP concerning Enable Midstream Partners, LP. This filing informs investors about the terms of the merger agreement and CenterPoint Energy's role in the transaction.
CenterPoint Energy will receive a combination of Energy Transfer common units (at an exchange ratio of 0.8595x Energy Transfer common units for each Enable common unit it owns), $5 million in cash for its interest in the General Partner of Enable, and approximately $385 million of Energy Transfer Series G Preferred Units in exchange for its Enable Series A Preferred Units.
The merger is expected to be completed in the second half of 2021, subject to customary closing conditions, including regulatory approvals such as Hart-Scott-Rodino antitrust clearance.
The Support Agreement requires CenterPoint Energy (and OGE Energy Corp.) to vote their respective Enable common units in favor of the merger once the necessary SEC filings are effective. It also obligates them to oppose any actions that could impede the merger and restricts them from soliciting or engaging in discussions regarding alternative acquisition proposals for their interests in Enable.