US-based electric and natural gas utility company, CenterPoint Energy has agreed to sell Miller Pipeline and Minnesota to PowerTeam Services for $850m.
The company said that it will use the net proceeds of the sale to repay a portion of its outstanding debt.
The Miller Pipeline and Minnesota are claimed to be the two of the premier natural gas distribution and transmission pipeline contractors in the US and provide services to customers in 35 states.
Both the companies were acquired CenterPoint Energy last year during the CenterPoint Energy and Vectren merger.
Headquartered in Indianapolis, Miller Pipeline employs over 3,500 people and Minnesota Limited is located in Big Lake, Minnesota with over 1,400 employees.
J.P. Morgan is acting as exclusive financial advisor to CenterPoint Energy
CenterPoint Energy president and CEO Scott Prochazka said: “The sale is a key achievement in our ongoing strategic focus to strengthen our balance sheet and improve our business risk profile and earnings quality pursuant to increased relative contribution of our core utility businesses.
“Post transaction, we expect our utility earnings contribution to increase to greater than 80% over the next few years.”
Subjected to the satisfaction of customary closing conditions, which include the expiration or termination of the Hart-Scott-Rodino waiting period, the transaction is expected to be completed in the second quarter of this year.
The combination of Miller Pipeline and Minnesota with PowerTeam is expected to create one of the largest integrated infrastructure services providers to the natural gas and electric industries in the US.
For the deal, J.P. Morgan is acting as exclusive financial advisor and Latham & Watkins is serving as legal counsel to CenterPoint Energy.
In February last year, CenterPoint Energy completed its previously announced $6bn merger of rival US gas and electric utility Vectren.
CenterPoint Energy is an energy delivery company that serves more than 7 million metered customers in Arkansas, Indiana, Louisiana, Minnesota, Mississippi, Ohio, Oklahoma and Texas.
