Sempra Energy Announces Agreement to Sell Stake in Luz del Sur in Peru

SAN DIEGO, Sept. 30, 2019 /PRNewswire/ -- Sempra Energy (NYSE: SRE) today announced that it has entered into an agreement to sell its equity interests in its Peruvian businesses, including its 83.6% stake in Luz del Sur S.A.A. (Luz del Sur), to China Yangtze Power International (Hongkong) Co., Limited (CYP). Sempra Energy's interests will be sold for $3.59 billion in cash, subject to closing adjustments for working capital and net indebtedness.

"We could not be more pleased about today's announcement," said Jeffrey W. Martin, chairman and CEO of Sempra Energy. "It directly supports our mission of building North America's premier energy infrastructure company. Proceeds from this transaction will be used to strengthen our balance sheet and meet the growing capital needs of our core utilities in California and Texas."

The sale will also include Sempra Energy's interest in Tecsur S.A., which provides electric construction and infrastructure services to Luz del Sur and third parties, and Inland Energy S.A.C., Luz del Sur's generation business.

The sale is expected to be completed in the first quarter of 2020, subject to customary closing conditions, including approval by the Peruvian anti-trust authority and the Bermuda Monetary Authority.

An active sales process continues for Sempra Energy's electric businesses in Chile, including the company's 100% stake in Chilquinta Energía S.A. and Tecnored S.A. The company expects to announce an agreement in the fourth quarter of this year.

BofA Merrill Lynch and Lazard are serving as financial advisors to Sempra Energy on the sale, and White & Case is serving as legal advisor.

Sempra Energy also announced today that its subsidiary Sempra LNG has entered into a memorandum of understanding with China Three Gorges Corporation (CTG), the ultimate parent company of CYP, regarding potential cooperation in supplying liquefied natural gas (LNG) to support demand growth in China, including the growth of natural gas power generation. Ultimate participation remains subject to finalization of a definitive agreement, among other factors.

"This initial agreement with CTG represents an opportunity to support strong growth in natural gas demand in Asia, with future expansions of our LNG projects right here in North America," said Martin.

Luz del Sur serves the southern region of Lima, Peru, and is the largest electric company in the country.

CYP is a subsidiary of China Yangtze Power Co., which is the largest publicly listed power company in China with a market capitalization of approximately $58 billion. China Yangtze Power Co. engages in electric power production, technological consultation of electric power generation and selected distribution services.

Sempra Energy's mission is to be North America's premier energy infrastructure company. With more than $60 billion in total assets reported in 2018, the San Diego-based company is the utility holding company with the largest U.S. customer base. The Sempra Energy companies' more than 20,000 employees deliver energy with purpose to approximately 40 million consumers worldwide. The company is focused on the most attractive markets in North America, including California, Texas, Mexico and the LNG export market. Sempra Energy has been consistently recognized for its leadership in diversity and inclusion, and sustainability, and is a member of the S&P 500 Utilities Index and the Dow Jones Utility Index.

Sempra Energy

CONTACT: Media Contact: Amber Albrecht, Sempra Energy, (877) 340-8875, media@sempra.com; Financial Contact: Lindsay Gartner, Sempra Energy, (877) 736-7727, investor@sempra.com

Web Site: http://www.sempra.co

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