Buffett's Berkshire to buy Texas power transmitter Oncor

New York — Warren Buffett's Berkshire Hathaway is buying the Texas power transmitter Oncor for $9bn, one of his biggest acquisitions.

Last year, Berkshire completed its biggest acquisition in its history, a $32.36bn deal for aviation parts maker Precision Castparts.

Oncor serves about 10 million people and is the biggest regulated utility in Texas. Its parent company, Energy Future Holdings Corp., entered bankruptcy in 2014 facing more than $40bn in debt after energy prices plunged.

Berkshire Hathaway will acquire a reorganised Energy Future, ultimately leading to the buyout of Oncor, based in Dallas.

It's the third time that that an acquisition attempt has been made for Oncor. In April Texas regulators rejected a proposed $18bn sale of Oncor to NextEra Energy. That price tag included debt, which may also double the enterprise value of the deal that Buffett is attempting to cobble together.

The regulators failed to accept that the NextEra transaction was in the public interest — a requirement for the deal. A buyout attempt last year backed by the Ray Hunt family of Dallas also faltered.

Berkshire Hathaway already has a significant presence in Texas, which includes headquarters for BNSF Railway, Acme Brick, Justin Brands, McLane, Berkshire Hathaway Automotive, Star Furniture, TTI, Charter Brokerage, LiquidPower Specialty Products and Allie Beth Allman & Associates.

The deal, which requires state, federal and bankruptcy court approval, is targeted to close in the fourth quarter.

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter:

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
17.96
-2.0%
Rand - Pound
19.39
+0.3%
Rand - Euro
17.36
+0.0%
Rand - Aus dollar
11.70
+0.0%
Rand - Yen
0.12
+0.1%
Gold
1,643.40
-0.0%
Silver
18.87
0.0%
Palladium
2,073.00
0.0%
Platinum
858.50
0.0%
Brent Crude
86.15
-5.0%
Top 40
57,110
-3.1%
All Share
63,417
-2.9%
Resource 10
56,319
-7.5%
Industrial 25
78,436
-1.2%
Financial 15
14,142
-1.6%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders