CenterPoint Energy and infrastructure services provider Power Team Services LLC Monday announced CenterPoint will sell Miller Pipeline and Minnesota Ltd. to PowerTeam for $850 million in cash, Kallanish Energy reports.
Miller Pipeline and Minnesota Ltd., which represent CenterPoint’s Infrastructure Services business, are natural gas distribution and transmission pipeline contractors in the U.S., providing services to customers in 35 states.
“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,” said CenterPoint president and CEO Scott Prochazka.
In 2019, both Miller Pipeline and Minnesota Ltd. were acquired by energy delivery company CenterPoint in the CenterPoint Energy-Vectren Corp. merger. Miller Pipeline is headquartered in Indianapolis, Indiana, and Minnesota Ltd. is based in Big Lake, Minnesota.
“PowerTeam’s combination with Miller Pipeline and Minnesota Ltd. creates a powerful platform with nationwide scale to continue to safely and reliably serve customers, provide enhanced career opportunities for employees, and capitalize on significant growth opportunities in the utility and energy infrastructure industry,” said Brian Palmer, CEO of PowerTeam, who will serve as the chief executive of the combined company.
Net proceeds of the sale will be used to repay a portion of outstanding CenterPoint Energy debt.
The sale is anticipated to be completed in the second quarter of 2020. J.P. Morgan is serving as financial advisor to CenterPoint Energy, and Latham & Watkins LLP is acting as legal counsel. Credit Suisse, UBS Investment Bank, and Harris Williams are serving as financial advisors to PowerTeam, and Debevoise & Plimpton LLP is acting as legal counsel to PowerTeam.
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