Fannie Mae, Freddie Mac shares tumble after conservatorship comments
Sempra (NYSE:SRE), a leading energy services holding company with a market capitalization of $45.4 billion, announced on Monday its plans to sell its natural gas distribution utility in Mexico, Ecogas, and a minority stake in Sempra Infrastructure Partners (SI), ranging from 15% to 30%. The Board of Directors reached this decision on Thursday, March 28, 2025, aiming to streamline the company’s operations. According to InvestingPro data, Sempra maintains strong financial metrics with a P/E ratio of 15.7, though its short-term obligations currently exceed liquid assets.
The move to divest Ecogas and a portion of Sempra’s 70% interest in SI is part of a strategic repositioning. SI, which represents one of Sempra’s reportable segments, holds the company’s non-U.S. utility energy infrastructure assets, including liquefied natural gas operations and related infrastructure in the U.S. and Mexico. The company has demonstrated consistent shareholder returns, with InvestingPro analysis showing a 28-year track record of maintaining dividend payments and 14 consecutive years of dividend growth.
Sempra’s subsidiary, which holds the SI interest, has notified minority partners Kohlberg Kravis Roberts & Co. L.P. (KKR) and Abu Dhabi Investment Authority (ADIA) of its intent to proceed with the Minority Interest Sale. Under the limited partnership agreement, KKR and ADIA have rights of first offer to purchase Sempra’s interests in SI. KKR has 30 business days to respond to the Sale Notice, followed by a 10-business-day period for ADIA to make an offer, should KKR decline.
If neither KKR nor ADIA exercises their right of first offer, or if a transaction is not completed within the stipulated timeframe, Sempra is free to engage with third parties. The planned sales are anticipated to conclude within the next 12 to 18 months, contingent upon reaching agreeable terms, obtaining necessary regulatory approvals, and fulfilling other customary conditions.
This announcement contains forward-looking statements that involve risks and uncertainties, including the completion of the sales and the timing thereof. Sempra has made it clear that the statements are based on current expectations and assumptions, which may change over time.
The information presented in this article is based on a press release statement from Sempra, filed with the U.S. Securities and Exchange Commission. Investors are advised that the company’s future results may differ materially from current estimates due to various factors, including regulatory actions and market conditions. However, InvestingPro analysts project 30% revenue growth for fiscal year 2025, with the stock currently trading near its 52-week low of $64.89. For deeper insights into Sempra’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Sempra’s subsidiary, San Diego Gas & Electric Company (SDG&E), has issued $850 million in First Mortgage Bonds with a 5.400% interest rate due in 2035. The bonds were sold to a group of underwriters, including CIBC (TSX:CM) World Markets Corp., Morgan Stanley (NYSE:MS) & Co. LLC, TD Securities (USA) LLC, and U.S. Bancorp (BVMF:USBC34) Investments, Inc., for public offering. This transaction is part of SDG&E’s capital-raising efforts and was conducted under the company’s effective shelf registration statement with the U.S. Securities and Exchange Commission. In another development, BMO Capital Markets has reduced Sempra Energy ’s price target to $78 from $92 but maintained an Outperform rating, reflecting cautious optimism despite a downward revision in the company’s 2025 guidance. Jefferies has downgraded Sempra Energy’s stock from "Buy" to "Hold," lowering the price target to $77, citing concerns about the company’s financial outlook and regulatory challenges. Barclays (LON:BARC) also downgraded Sempra Energy from Overweight to Equal Weight, slashing the price target to $72 due to significant financial adjustments and concerns over increased costs and equity dilution. These recent developments highlight the varied perspectives of analysts on Sempra Energy’s financial strategies and future performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.