Warren Buffett's Berkshire Hathaway Will Not Buy Bankrupt Oncor

CEO Warren Buffett plays bridge during the Berkshire annual meeting weekend in Omaha Nebraska

Elliott had tried to put together its own bid for $9.3 billion to buy Oncor but ultimately made a decision to back the Sempra deal, which a spokesman said "provides substantially greater recoveries to all creditors of Energy Future than the proposed Berkshire transaction". Sempra shareholders would own roughly 60 percent of the reorganized company following the transaction. The Dallas-based Oncor holding company, formerly TXU Corp., at the the time struck agreements with key stakeholders to cut about $40 billion in debt, lower interest expenses, access additional capital "and create a sustainable capital structure for the future". We believe our agreement with Energy Future will help ensure that Texas utility customers continue to receive the outstanding electric service they have come to expect from Oncor and provide stability to Oncor's almost 4,000 employees.

In July, Berkshire Hathaway Energy agreed to pay $9 billion for EFH.

Elliott recently bought debt in Oncor's parent in its latest effort to block Berkshire's bid, people familiar with that matter said August 16.

The transaction of the largest power distribution/transmission system in Texas should be accretive beginning next year, Sempra officials said.

"With its strong management team and long, distinguished history as Texas' leading electric provider, Oncor is an excellent strategic fit for our portfolio of utility and energy infrastructure businesses", said Debra Reed, Sempra chief executive.

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The enterprise value of the transaction is estimated at $18.8 billion, including debt.

The company runs power and gas utilities in Southern California, Chile and Peru reach to over 32 million customers.

The deal is expected to close in the first half of 2018, however, it still needs the approval of the Public Utility Commission of Texas, the U.S. Bankruptcy Court of DE, the Federal Energy Regulatory Commission and the U.S. Department of Justice. Buffett is known for avoiding bidding wars. Previously, in April Texas regulators rejected a proposed $18 billion sale of Oncor to NextEra Energy Inc. Both will serve on Oncor's board. The regulatory commitments were included in an agreement that was signed by five significant parties that supported the proposal.

Sempra said Oncor's board will retain its existing independence. Energy Future's earlier efforts to sell the firm have failed.

"It is important for Oncor to remain financially strong", Reed said. Buying the notes means Elliott and and Sunrise Partners, which also opposes Berkshire's offer valued at $18.2 billion with debt, own the majority of every class of impaired credit in the holding company, one of the people said.

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