2021 has been a milestone year with the formation of Sempra Infrastructure, combining two of Sempra’s world-class infrastructure business into a larger platform that is positioned to capture new opportunities to advance the global energy transition to lower-carbon energy.
Focused on delivering energy for a better world, Sempra Infrastructure develops, builds, and operates North American energy infrastructure that connects customers across the globe to the next generation of cleaner energy technologies and infrastructure. As we work to create scale and unlock synergies in our growth platforms of clean power, energy networks and LNG and net-zero solutions infrastructure, aligning with partners that share our vision of investing in the energy systems of tomorrow is central to our strategy.
Earlier this year, Sempra Infrastructure welcomed KKR as a partner in a transaction that valued our business at approximately $25.2 billion. Yesterday, Sempra announced a definitive agreement to sell an additional 10% non-controlling interest in Sempra Infrastructure to a subsidiary of the Abu Dhabi Investment Authority (ADIA) for $1.785 billion, highlighting an even higher enterprise value of $26.5 billion. Like KKR, ADIA’s strategy is aligned with ours, which is to focus on generating superior long-term financial returns by targeting needed infrastructure investments in North America.
“We could not be more excited about our agreement to partner with the Abu Dhabi Investment Authority. Adding another strategic partner to our capital structure improves our position as a leader in the build-out of the new energy systems here in North America to power the world of tomorrow,” said Justin Bird, CEO of Sempra Infrastructure. “Today’s announcement is the perfect bookend on this transformational year.”
The transaction will add one of the world’s largest international investment funds to our partnership as we remain focused on opportunities to build the next generation of energy technologies and infrastructure. Together with Sempra and KKR, ADIA’s focus and extensive investments in global energy assets are expected to help us expand our global capabilies and scale.
And, the timing is important.
Current forecasts by the International Energy Agency (IEA) indicate that the combustion of coal globally is expected to reach an all-time high in 2021. That is why businesses like ours are critical to helping lead the energy markets to cleaner, near-term solutions. We will continue our focus on growing our platform of more than 1,500 megawatts of clean power generation; over 4,500 miles of natural gas transportation and distribution pipelines connecting the United States and Mexico; and a LNG and net-zero solutions business that provides access to abundant North American natural gas from the U.S. Gulf Coast and Mexican Pacific Coast, while advancing investments in adjacent infrastructure like carbon sequestration and clean hydrogen.
The transaction is expected to be completed in the summer of 2022, subject to customary closing conditions and consents from regulators.
About Sempra Infrastructure
Sempra Infrastructure delivers energy for a better world. Through the combined strength of its assets in North America, the company is dedicated to enabling the energy transition and beyond. With a continued focus on sustainability, innovation, world-class safety, championing people, resilient operations and social responsibility, its more than 2,000 employees develop, build and operate clean power, energy networks and LNG and net-zero solutions, that are expected to play a crucial role in the energy systems of the future. For more information about Sempra Infrastructure, please visit www.SempraInfrastructure.com.
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In this article, forward-looking statements can be identified by words such as “believes,” “expects,” “anticipates,” “plans,” “estimates,” “projects,” “forecasts,” “should,” “could,” “would,” “will,” “confident,” “may,” “can,” “potential,” “possible,” “proposed,” “in process,” “under construction,” “in development,” “target,” “outlook,” “maintain,” ”continue,” “goal,” “aim,” “commit,” or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations.
Factors, among others, that could cause actual results and events to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: decisions, investigations, regulations, issuances or revocations of permits and other authorizations, and other actions by (i) the U.S. Department of Energy, Comisión Reguladora de Energía, U.S. Federal Energy Regulatory Commission and other regulatory and governmental bodies and (ii) states, counties, cities and other jurisdictions in the U.S., Mexico and other countries in which we do business; the success of business development efforts, construction projects and acquisitions and divestitures, including risks in (i) the ability to make a final investment decision, (ii) completing construction projects or other transactions on schedule and budget, (iii) the ability to realize anticipated benefits from any of these efforts if completed, and (iv) obtaining the consent or approval of partners or other third parties, including governmental entities; the resolution of civil and criminal litigation, regulatory inquiries, investigations and proceedings, and arbitrations; changes to laws, including proposed changes to the Mexican constitution that could materially limit access to the electric generation market and changes to Mexico’s trade rules that could materially limit our ability to import and export hydrocarbons; failure of foreign governments and state-owned entities to honor their contracts and commitments and property disputes; actions by credit rating agencies to downgrade our credit ratings or to place those ratings on negative outlook and our ability to borrow on favorable terms and meet our substantial debt service obligations; the impact of energy and climate goals, policies, legislation and rulemaking, including actions to reduce or eliminate reliance on natural gas generally; the pace of the development and adoption of new technologies in the energy sector, including those designed to support governmental and private party energy and climate goals, and our ability to timely and economically incorporate them into our business; weather, natural disasters, pandemics, accidents, equipment failures, explosions, acts of terrorism, information system outages or other events that disrupt our operations, damage our facilities and systems, cause the release of harmful materials, cause fires or subject us to liability for property damage or personal injuries, fines and penalties, some of which may not be covered by insurance, may be disputed by insurers or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of natural gas; the impact of the COVID-19 pandemic, including potential vaccination mandates, on capital projects, regulatory approvals and the execution of our operations; cybersecurity threats to the storage and pipeline infrastructure, information and systems used to operate our businesses, and confidentiality of our proprietary information and personal information of our customers and employees, including ransomware attacks on our systems and the systems of third-party vendors and other parties with which we conduct business; volatility in foreign currency exchange, inflation and interest rates and commodity prices and our ability to effectively hedge these risks; changes in tax and trade policies, laws and regulations, including tariffs and revisions to international trade agreements that may increase our costs, reduce our competitiveness, or impair our ability to resolve trade disputes; and other uncertainties, some of which may be difficult to predict and are beyond our control.
These risks and uncertainties are further discussed in the reports that Sempra has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC’s website, www.sec.gov, and on Sempra’s website at www.sempra.com. Investors should not rely unduly on any forward-looking statements.
Sempra Infrastructure is not the same company as San Diego Gas & Electric or Southern California Gas Company, and neither Sempra Infrastructure nor any of its subsidiaries are regulated by the California Public Utilities Commission.
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