Exclusive: Sempra nears $3 billion Chile sale to China's State Grid -
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 [October 12, 2019] By
Julie Zhu and Greg Roumeliotis
(Reuters) - U.S. power company Sempra
Energy <SRE.N> is near an agreement to sell its Chilean business to
State Grid Corporation of China for close to $3 billion, the latest deal
in its bid to shed non-core assets, people familiar with the matter said
on Friday.
Sempra has been seeking to bolster its finances and increase its appeal
to investors after a wave of wildfires in California exposed it and
other utilities to more legal liabilities. It also came under pressure
from hedge fund Elliott Management Corp and investment firm Bluescape
Group to scale back its global operations.
Sempra's deal with State Grid Corporation of China could be announced as
early as next week, the sources said, cautioning it was still possible
that negotiations may falter at the last minute and asking not to be
identified because the matter is confidential.
Sempra declined to comment, while State Grid Corporation of China did
not immediately respond to requests for comment.
China, whose booming economy over the past two decades has driven up
demand for South America's raw materials, has been investing more in
Chile as it seeks to secure resources.
Chile, among Latin America's most open economies and the world's top
copper exporter, has sought to remain neutral amid the growing trade
tensions between China and the United States, promoting instead the need
for open markets.
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Sempra Energy headquarters is pictured in downtown San Diego,
California, U.S., May 17, 2018. REUTERS/Mike Blake
Sempra said in January it would wind down its South American businesses. Last
month, it announced it would sell its Peruvian businesses to a unit of China
Yangtze Power Co for $3.6 billion, as it focuses on its core U.S. and Mexican
markets.
Elliott has now exited its investment in Sempra, according to its latest
quarterly regulatory filing.
Sempra's Chilean businesses include Chilquinta Energía SA, the third-largest
distributor of electricity in the country, and Tecnored SA, which provides
construction services to Chilquinta.
State Grid Corporation of China beat out a number of other bidders. Italian
utility Enel <ENEI.MI> had said in June it had made a bid for both the Chilean
and Peruvian businesses.
Based in San Diego, Sempra owns power utilities that collectively have the
largest U.S. customer base. It has about 40 million customers, and is active in
California, Texas and Mexico. It also participates in the export market for
liquefied natural gas, with Saudi Aramco as one of its clients.
(Reporting by Julie Zhu in Hong Kong and Greg Roumeliotis in New York;
Additional reporting by David French in New York; Editing by Rosalba O'Brien)
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