NextEra Energy reaches agreements with global financial institutions for Oncor transaction

JUNO BEACH, Fla., Aug. 29, 2016 /PRNewswire/ -- NextEra Energy, Inc. (NYSE: NEE) today announced that it has secured access to a broad contingent of leading financial institutions to act as financial advisors related to its previously announced definitive agreement to acquire 100 percent of the equity of reorganized Energy Future Holdings Corp. ("EFH") and certain of its direct and indirect subsidiaries, including EFH's approximately 80 percent indirect interest in Oncor Electric Delivery Company LLC ("Oncor").

The contingent of financial institutions is led by Credit Suisse Securities (USA) LLC and Bank of America Merrill Lynch and includes Deutsche Bank Securities Inc., Goldman, Sachs & Co., J.P. Morgan Securities LLC, UBS Securities LLC, Wells Fargo Securities, LLC, BNP Paribas Securities Corp., CIBC World Markets Corp., Credit Agricole Corporate and Investment Bank, KeyBanc Capital Markets Inc., Mizuho Securities USA Inc., Scotiabank Capital (USA) Inc., Sumitomo Mitsui Banking Corporation, TD Securities (USA) LLC, The Bank of Tokyo-Mitsubishi UFJ, LTD. and U.S. Bank National Association. Under agreements entered into with these financial institutions, the entities have agreed to serve as financial advisors on the acquisition of Oncor. NextEra Energy's access to these institutions to support the Oncor transaction demonstrates its strong reputation as a borrower and significantly strengthens the ability of NextEra Energy to obtain financing for the proposed transaction.

"We are pleased to have reached agreements with this well-respected contingent of global banks, which provide further assurance of our ability to finance our proposed acquisition of Oncor," said Jim Robo, chairman and chief executive officer of NextEra Energy. "These agreements underscore NextEra Energy's financial strength and our longstanding relationships with a number of leading financial institutions. We appreciate the trust they have placed in our company and look forward to bringing this financial strength and additional financial resources to the combined company for the benefit of Oncor and its customers."

As part of the Oncor transaction, NextEra Energy intends to fund $9.5 billion, primarily for the repayment of approximately all of the Energy Future Intermediate Holding Company LLC ("EFIH") debt. It is expected that certain creditors will be paid primarily in cash with the remainder in NextEra Energy common stock. The number of shares issuable to creditors will be determined based on the estimated cash on hand at EFH at the closing of the transaction, the volume weighted average price of NextEra Energy common stock for a specified number of days leading up to the closing and other factors specified in the definitive agreement. NextEra Energy intends to use a combination of debt, convertible equity units and proceeds from asset sales to fund cash being provided to creditors.

The Oncor transaction is not subject to any financing contingencies. NextEra Energy intends to repay in full the EFIH first lien debtor-in-possession ("DIP") financing facility (currently approximately $5.4 billion principal amount) using cash financed by a non-EFH/Oncor NextEra Energy affiliate upon closing. As part of EFH's plan of reorganization, the transaction would extinguish all EFH and EFIH debt that currently exists above Oncor.

Earlier this month, NextEra Energy sold $1.5 billion of convertible equity units. The net proceeds from the sale of the convertible equity units will be used, among other things, to finance the Oncor transaction. The remaining amount of the $9.5 billion for the Oncor transaction will be funded with debt, equity and capital recycling in a manner that should allow NextEra Energy to maintain its strong credit ratings and allow Oncor to improve its credit ratings.

Benefits to Oncor and its customers

The agreements with these financial institutions will support NextEra Energy's proposed combination with Oncor, which will improve Oncor's financial strength and generate tangible benefits for Oncor's customers. Upon completion of the transaction, Oncor will join a family of companies that shares its commitment to making the smart, long-term investments necessary to maintain and support affordable, reliable electric service. The proposed transaction will, among other things:

• Extinguish all EFH and EFIH debt that currently resides above Oncor immediately following closing;
• Improve Oncor's financial strength and credit ratings – based solely on the news of the merger announcement, Moody's Investors Service upgraded Oncor's senior secured credit rating from Baa1 to A3 and placed the rating on review for further upgrade. In addition, Standard & Poor's Financial Services revised Oncor's outlook to positive from developing and Fitch Ratings placed Oncor on Rating Watch Positive;
• Ensure the support of Oncor's existing five-year capital plan, which includes substantial and necessary planned capital improvement projects across the state;
• Enhance Oncor's ability to provide safe, reliable and affordable electric delivery service to its customers well into the future by partnering with a world-class energy company with a long-term commitment to Texas;
• Retain local management, the Dallas headquarters and the Oncor name;
• Provide workforce stability and protections for Oncor employees, including no involuntary workforce reductions at Oncor for at least two years after the transaction closes;
• Embrace a robust set of regulatory and governance requirements, pertaining to electric reliability, operations, employee protection, accounting, ratemaking, code of conduct and Public Utility Commission of Texas reporting commitments; and
• Eliminate the financial risks created by the 2007 EFH acquisition and facilitate the resolution of the EFH bankruptcy.

Merger approval process

The transaction is subject to bankruptcy court approval of the merger agreement and EFH's plan of reorganization, approval by the Public Utility Commission of Texas, the expiration or termination of the waiting period under the Hart-Scott-Rodino Act, approval by the Federal Energy Regulatory Commission and other customary conditions and approvals.

NextEra Energy expects the transaction, which has been approved by the boards of directors of both NextEra Energy and EFH, to be completed in the first quarter of 2017.

NextEra Energy, Inc.

NextEra Energy, Inc. (NYSE: NEE) is a leading clean energy company with consolidated revenues of approximately $17.5 billion and approximately 14,300 employees in 27 states and Canada as of year-end 2015, as well as approximately 45,000 megawatts of generating capacity, which includes megawatts associated with noncontrolling interests related to NextEra Energy Partners, LP (NYSE: NEP) as of April 2016. Headquartered in Juno Beach, Fla., NextEra Energy's principal subsidiaries are Florida Power & Light Company, which serves more than 4.8 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the United States, and NextEra Energy Resources, LLC, which, together with its affiliated entities, is the world's largest generator of renewable energy from the wind and sun. Through its subsidiaries, NextEra Energy generates clean, emissions-free electricity from eight commercial nuclear power units in Florida, New Hampshire, Iowa and Wisconsin. A Fortune 200 company and included in the S&P 100 index, NextEra Energy has been recognized often by third parties for its efforts in sustainability, corporate responsibility, ethics and compliance, and diversity, and has been ranked No. 1 in the electric and gas utilities industry in Fortune's 2016 list of "World's Most Admired Companies." For more information about NextEra Energy companies, visit these websites: www.NextEraEnergy.com, www.FPL.com, www.NextEraEnergyResources.com.

Forward-Looking Statements

This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as "may," "will," "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," "predict," and "target" and other words and terms of similar meaning. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. NEE cautions readers that any forward-looking statement is not a guarantee of future performance and that actual results could differ materially from those contained in any forward-looking statement. Such forward-looking statements include, but are not limited to, statements about the anticipated benefits of the proposed merger involving NEE and EFH, including future financial or operating results of NEE or Oncor, NEE's, EFH's or Oncor's plans, objectives, expectations or intentions, the expected timing of completion of the transaction, the value, as of the completion of the merger or as of any other date in the future, of any consideration to be received in the merger in the form of stock or any other security, NEE's ability to finance the transaction, anticipated changes to the credit ratings of NEE or Oncor, and other statements that are not historical facts. Important factors that could cause actual results to differ materially from those indicated by any such forward-looking statements include risks and uncertainties relating to: the risk that EFH may be unable to obtain bankruptcy court approval and that NEE, EFH or Oncor may be unable to obtain governmental and regulatory approvals required for the merger, or required bankruptcy court and governmental and regulatory approvals may delay the merger or result in the imposition of conditions that could cause the parties to abandon the transaction; the risk that a condition to closing of the merger may not be satisfied; the expected timing to consummate the proposed merger; the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers; the diversion of management time and attention on merger-related issues; general worldwide economic conditions and related uncertainties; the effect and timing of changes in laws or in governmental regulations (including environmental); fluctuations in trading prices of securities of NEE and in the financial results of NEE, EFH or Oncor or any of their subsidiaries; the timing and extent of changes in interest rates, commodity prices and demand and market prices for electricity; and other factors discussed or referred to in the "Risk Factors" section of Oncor's or NEE's most recent Annual Reports on Form 10-K filed with the Securities and Exchange Commission ("SEC"). These risks, as well as other risks associated with the merger, will be more fully discussed in subsequent filings with the SEC in connection with the merger. Additional risks and uncertainties are identified and discussed in NEE's and Oncor's reports filed with the SEC and available at the SEC's website at www.sec.gov. Each forward-looking statement speaks only as of the date of the particular statement and NEE does not undertake any obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.

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SOURCE NextEra Energy, Inc.