NextEra Energy failed to persuade skeptical utility regulators in Texas to take another look at its stalled $18.4 billion bid for Oncor Electric Delivery.
On Thursday, the Public Utility Commission of Texas refused NextEra’s second request for a rehearing on a deal which it originally rejected in April. The sale of the biggest transmission operator in the state is key to rescuing Oncor’s parent Energy Future Holdings Corp. from bankruptcy. Both Oncor and NextEra declined to comment.
“It is time to bring this chapter in the EFH bankruptcy to a close and consider other options more suitable to Oncor and its ratepayers,” Commissioner Kenneth Anderson Jr. wrote in a memorandum before Thursday’s meeting. Commissioner Brandy Marty Marquez said she was “good” with Anderson’s memo.
Selling Oncor is the last hurdle in ending the high-profile bankruptcy of Dallas-based Energy Future Holdings, formed by KKR, TPG Capital and Goldman Sachs Capital Partners in the record leveraged buyout of the former TXU Corp. Energy Future has been working to restructure almost $50 billion in debt since it filed for Chapter 11 in 2014. In its request, NextEra laid out 14 reasons why the agency’s initial denial was wrong, to little avail.
At a meeting with investors last week, Jim Robo, chief executive officer of the Florida-based company, described his bid for Oncor as “the best deal for customers and creditors.”
But Texas regulators have expressed concerns throughout NextEra’s proceedings about the loss of ring-fencing measures designed to protect Oncor’s credit rating and control of the company’s board. Oncor serves 10 million customers with the largest distribution and transmission system in Texas.
“I remain unpersuaded by their regurgitation of essentially the same arguments,” Anderson wrote in the memo.