Duke Energy Florida braces for Hurricane Idalia (Courtesy: Duke Energy)
Duke Energy announced it has entered into a definitive agreement for Brookfield, through its Super-Core Infrastructure strategy, to hold a 19.7% indirect equity interest in Duke Energy Florida for an aggregate amount of $6 billion.
Brookfield is an infrastructure investor, with over $200 billion in assets under management across the utilities, transport, midstream, and data sectors.
Duke Energy said the investment represents a “significant premium” to its current public equity valuation. Two billion dollars of the proceeds from the transaction will fund Duke Energy’s increased $87 billion, five-year capital plan, and $4 billion will be used to displace holding company debt.
“For more than a century, we’ve had the privilege of serving extraordinary Florida communities, which are now some of the most dynamic and fastest growing in the nation,” said Harry Sideris, president and chief executive officer.
“We’re pleased to have Brookfield, a highly regarded infrastructure investor, as a long-term partner in Duke Energy Florida. This significant transaction at a compelling valuation best positions Duke Energy to unlock additional capital investments in Duke Energy Florida during this unprecedented growth period. It also materially strengthens Duke Energy’s overall credit profile, which in turn enables us to invest in our energy modernization plans across our entire footprint – all while helping keep prices as low as possible for our customers.”
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Duke Energy Florida is a vertically integrated electric utility company that services 2 million customers across central and western Florida. The $4 billion increase in Duke Energy Florida’s five-year capital plan takes total investment in the state to over $16 billion through 2029. This plan is underpinned by grid modernisation and resiliency initiatives, as well as generation capacity enhancements.
“Duke Energy’s commitment to our customers and communities is unwavering, driving us to continuously find innovative ways to meet the moment for our customers. This exciting partnership allows us to do just that,” said Melissa Seixas, Duke Energy Florida state president. “This partnership will create value for all of our communities as we invest in generation, transmission, and distribution enhancements that increase reliability, maintain affordability, and support future economic development in our state.”
Brookfield will invest in Florida Progress, which owns all of Duke Energy Florida. Brookfield will acquire its indirect equity interest in Duke Energy Florida in phases, with Florida Progress receiving $2.8 billion at the first closing, expected to occur in early 2026, and another $200 million by the end of 2026. An additional $2 billion will be received in 2027, and the remaining $1 billion will be received in 2028. Brookfield has the option to fund the total $6 billion investment sooner.
Duke Energy will retain an 80.3% interest in the business, with no changes to workforce, operations, or the Florida leadership team at Duke Energy Florida. Brookfield will receive certain rights commensurate with its ownership interest.
The transaction is subject to customary closing conditions, including regulatory approval from the Federal Energy Regulatory Commission and completion of review by the Committee on Foreign Investment in the United States, as well as approval, or a determination that the transaction does not require approval, by the Nuclear Regulatory Commission.
Originally published by Sean Wolfe on Factor This.
