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NextEra Completes Deal To Purchase Gulf Power
January 2, 2019
Gulf Power started 2019 with a new owner.
NextEra Energy Inc., the parent company of Florida Power & Light, announced early Tuesday that it has finished an earlier-announced deal to purchase Gulf Power from the Atlanta-based Southern Company. The deal expands NextEra’s already-large footprint in Florida and is a major change in the Panhandle, where Gulf serves about 450,000 customers in eight counties.
In a statement Tuesday announcing the completion of the sale, NextEra Chairman and Chief Executive Officer Jim Robo praised Gulf Power’s work to restore electricity after Hurricane Michael caused massive damage in October in Northwest Florida.
“The last few months have been among the most challenging periods in Gulf Power’s rich history as the team worked tirelessly to restore power to those impacted by Hurricane Michael,” Robo said. “We couldn’t be more pleased by Gulf Power’s performance and commitment to getting the lights back on during what were extremely dangerous and difficult conditions. As we turn to the future, we look forward to extending to Gulf Power’s customers our best-in-class value proposition of low bills, clean energy, high reliability and outstanding customer service.”
NextEra and Southern Company in May announced a $6.475 billion deal that included NextEra purchasing Gulf Power, the Florida City Gas natural-gas company and ownership interests in two power plants. The parts of the deal involving Florida City Gas and the power plants had already been completed.
In a statement Tuesday, Thomas A. Fanning, chairman, president and CEO of Southern Company, said the deal would bolster his company.
“These sales deliver substantial value to Southern Company and our stockholders,” he said. “By strengthening our financial position and allowing us to fund our business without raising significant additional capital, the value proposition of this deal is clear.”
In the initial May announcement of the deal, NextEra said the $6.475 billion purchase price included assuming about $1.4 billion of Gulf Power debt. It also said the Gulf Power purchase was expected to close during the first half of 2019 — but NextEra and Southern Company issued news releases on New Year’s Day announcing the completion.
Gulf Power is the fourth-largest private electric utility in the state, behind Florida Power & Light, Duke Energy Florida and Tampa Electric Co. Gulf serves customers in Bay, Escambia, Holmes, Jackson, Okaloosa, Santa Rosa, Walton and Washington counties.
Florida Power & Light, by comparison, has about 5 million customers, with its territory including much of the state’s East Coast, heavily populated South Florida and much of Southwest Florida.
by Jim Saunders, The News Service of Florida
Comments
6 Responses to “NextEra Completes Deal To Purchase Gulf Power”
David huie:
After hundreds of years and thousands of buyiuts, conglomerations, mergers and sales of companies, please point out ONE that has actually lowered any cost for ANYONE. Generally, buyouts mean assumption of debt and in this case it’s 1.4 billion. Will this debt just be erased? A tax write off? Or will it be assessed as some sort of increase to the customers via a carefully explained rate hike assessed to every customer. Yeah, welcome to business 101. There is no free lunch David.
Why do I suspect that my rates aren’t going down anytime soon. They gotta pay for it somehow.
REGARDING:
“guess who will be paying for this purchase? Us, the customers.”
Explain please.
David for understanding
It’s amazing that just yesterday, it was reported that Gulf Power energy prices are going down after the tax breaks. Now today, the deal has been finalized. So, Gulf Power will likely keep the tax break now and guess who will be paying for this purchase? Us, the customers. As the CEO put it, it’s all about the shareholders. Got to make up for his mistakes and pad his own pockets as well. Oh well. Nothing we can do. Not like there is any other alternative to these monopolies.
Large deal put in perspective:
Southern Company sells Gulf Power for $6.475 billion.
Southern Company is worth $45.2 billion which employs 32,000 people and supplies power all over the South East.
Facebook is worth $375 billion.
Crazy times in which a free web site is worth almost 10X the value of an electric utility conglomerate.
Personally, I am amazed Tom Fanning continues to sit atop Southern Company. With the fiascos of MPC Kemper County and two GPC nuclear units costing the company approximately $10B they had not planned on, any other mere mortal would of lost their job.
The sale of Gulf Power is the direct fallout brought by this gross mismanagement and is a slap in the face to the great pioneers who brought The Southern Company to fruition a hundred years ago.