Sempra Energy to buy Oncor for $9.45n

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

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

Officials at Sempra, Oncor and Berkshire Hathaway did not respond to requests for comment Sunday night but the deal is expected to be announced Monday. A final agreement has yet to be reached and talks may still fall apart, the report said citing people familiar with the matter.

Berkshire Hathaway Energy CEO Greg Abel then issued a statement that the company would stand firm on its offer and would not increase its bid.

Sempra Energy's headquarters in downtown San Diego. Oncor is a division of bankrupt Energy Future Holdings Corp.

Sempra Energy is about to wrap up a mega-deal to acquire a power transmission company located in Dallas, and the San Diego-based Fortune 500 company seems to have beat out Warren Buffet in the process.

Berkshire had told the PUCT it would accept "ringfencing" on its acquisition of Oncor, restricting its ability to extract cash from the company or add more debt to it. Sempra has now indicated it that will make similar concessions on ringfencing, according to the sources.

Sempra said the transaction, which is due to complete in the first half of next year, will enhance earnings beginning in 2018 and further expand its regulated earnings base, while serving as a platform for future growth in the Texas energy market and US Gulf Coast region.

Sempra decided to make an offer for Oncor in the last three weeks, after seeing the opposition that Berkshire faced from Elliott as an opportunity to interlope, according to the sources. Earlier this year, it signed a memorandum of understanding with Korea Gas Corp for the development of a liquefied natural gas liquefaction project in Port Arthur, Texas. It worked, keeping Oncor financially healthy even as Energy Future sank.

Texas utility regulators this year quashed a NextEra Energy Inc offer valued at US$18.4 billion including debt, after the utility giant refused to accept measures to protect Oncor's credit.

The company took part in a leveraged buyout in 2007 and when energy prices started falling, the company's fortunes went downhill.

Despite Energy Future's problems, Oncor is considered a good investment by many, including Buffett.

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