A federal bankruptcy court on Monday approved a plan to sell an 80 percent stake in Texas transmission company Oncor Electric Delivery to NextEra Energy for $18.7 billion.
The sale is part of the restructuring plan for Energy Future Holdings (EFH), Oncor’s parent company. EFH declared Chapter 11 bankruptcy two years ago.
NextEra and Oncor will now seek approval from the Public Utility Commission of Texas, NextEra said in a press release.
"Our proposed transaction provides Oncor with a financially strong, utility-focused owner that shares Oncor's commitment to providing customers with affordable, reliable electric delivery service and significant value and certainty for the EFH bankruptcy estate,” said Jim Robo, chairman and chief executive officer of NextEra.
If the deal is approved, NextEra would gain 200,000 miles of power lines and 8.6 million customer accounts. Company officials expect to close the transaction in the first quarter of 2017. The deal was announced July 29, about a month after NextEra terminated its $2.6 billion acquisition of Hawaiian Electric Co.
Under the agreement, some creditors will be paid primarily in cash and the remaining creditors will receive common stock in NextEra Energy. Also, NextEra will maintain Oncor’s Dallas headquarters and retain the Oncor name. What’s more, NextEra will not lay off any employees or cut salaries for at least two years after the sale is completed.