Sempra's Mexican Unit IEnova Sells Shares to Fund Expansion

By Anthony Harrup 

MEXICO CITY -- The Mexican unit of Sempra Energy raised around $1.43 billion in a capital increase and will use the money to pay for recent acquisitions in the gas and electricity sectors, the company said Friday.

Infraestructura Energética Nova SAB, or IEnova, priced 344.9 million shares at 80 Mexican pesos ($4.22) per share in a global offering, of which about a third was sold in Mexico and the rest internationally.

An additional 35.1 million shares in overallotments can be exercised over the next month. The share offering including the overallotments is equivalent to about 24.8% of IEnova.

San Diego-based Sempra Energy participated in the capital increase, agreeing to buy shares for $350.7 million. Net proceeds to IEnova, excluding the overallotments, are estimated at $1.43 billion.

IEnova will use the money to repay bridge financing for its recent $1.14 billion acquisition of state oil company Petróleos Mexicanos' 50% stake in pipeline joint-venture Gasoductos de Chihuahua, which is now wholly owned by IEnova. It will also use funds to partly finance the acquisition of two wind farms in northeastern Mexico, which it recently agreed to buy for $375 million plus the assumption of $477 million in debt.

Shares in IEnova, the only pure energy play on the Mexican stock exchange, were gaining 2.5% to 82.90 pesos in early trading Friday.

IEnova is also developing new projects. It owns 40% of a joint-venture with TransCanada Corp. that won a contract from Mexico's state electric utility to build a 500-mile, $2.1 billion offshore pipeline to carry natural gas from South Texas to northeastern Mexico. And at an auction last month, it won long-term contracts to supply electricity from two solar power plants in which it will invest about $150 million.

Write to Anthony Harrup at [e-mail]

(END) Dow Jones Newswires

October 14, 2016 11:43 ET (15:43 GMT)

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