Warren Buffet is making a play for Texas’ largest electric transmission utility.
Berkshire Hathaway, the famed billionaire’s multinational conglomerate, unveiled a roughly $18 billion deal Friday to buy Oncor, whose roughly 120,000 miles of transmission and distribution lines deliver power to more than 3 million homes and businesses in North and West Texas.
If approved, the deal could help deliver Energy Future Holdings, Oncor’s parent company and Texas’ largest power conglomerate, from one of the largest corporate bankruptcies in American history. That company, which filed for Chapter 11 bankruptcy in 2014, is saddled with about $50 billion in debt.
“Oncor is an excellent fit for Berkshire Hathaway, and we are pleased to make another long-term investment in Texas — when we invest in Texas, we invest big,” Buffett said in a joint news release from Berkshire Hathaway and Oncor.
The proposed merger would need the sign-off of the Delaware judge overseeing Energy Future Holdings’ bankruptcy, along with approvals from the Public Utility Commission of Texas and federal regulators.
Berkshire Hathaway would pay $9 billion cash for Oncor and assume its debt, making the deal worth roughly $18 billion.
Bob Shapard, Oncor’s CEO, called the latest proposal “a great outcome for Oncor.”
“By joining forces with Berkshire Hathaway Energy, we will gain access to additional operational and financial resources as we continue to position Oncor to support the evolving energy needs of our state,” he said in a statement.