Dominion Energy sells remaining Cove Point stake to Berkshire Hathaway Energy

Dominion Energy (D) announced that it has concluded a robust and competitive sale process and executed a definitive agreement to sell its 50% noncontrolling limited partner interest in Cove Point LNG, LP, to Berkshire Hathaway Energy (BRK.A), which currently operates the facility and owns a 100% general partner and 25% limited partner interest. The total transaction value of $3.5 billion, inclusive of transaction proceeds ($3.3B) and expected proceeds from the termination of related interest rate derivatives ($0.2B), represents approximately 10.8x estimated 2025 EBITDA of $325M for Dominion Energy’s 50% noncontrolling interest in Cove Point. Total after-tax proceeds of approximately $3.3B are expected to be used to repay debt including the existing $2.3B term loan secured by its noncontrolling interest in Cove Point. The company estimates that the transaction will increase the company’s consolidated FFO to debt by approximately 0.7%. Associated with repaying the term loan, the company will unwind its related in the money “floating-to-fixed” interest rate derivative which is expected to result in proceeds to the company of approximately $200M. The sale is subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Act and a filing with the U.S. Department of Energy.