FirstEnergy gains $1.2B in proceeds as sale of transmission subsidiary gets finalized

FirstEnergy Corp. on July 17 received the remaining $1.2 billion in proceeds from the sale of its FirstEnergy Transmission LLC (FET) subsidiary, and said it will use the funds to further improve its balance sheet and support its five-year, $26 billion Energize365 grid investment program.

“With the successful execution of these strategic transactions, FirstEnergy now has a strong balance sheet to support important investments in our regulated businesses that enhance service reliability, the customer experience, and the transition to a more electrified economy,” FirstEnergy President and CEO Brian Tierney said in a statement released Wednesday.

FirstEnergy sold its 30-percent ownership interest in FET to Brookfield Super-Core Infrastructure Partners for $3.5 billion, receiving the initial proceeds of $2.3 billion from Brookfield when the transaction closed in March. The remaining $1.2 billion in interest-bearing notes were extinguished with Brookfield’s final payment on July 17.

Since late 2021, FirstEnergy reports that it has completed roughly $7 billion in strategic equity financings at an equivalent share price of $87 per share, or 36 times trailing price-to-earnings valuation.

Following the closing of the FET/Brookfield deal, FirstEnergy’s corporate credit rating was upgraded by Moody’s and S&P, which restored it to investment grade at all three ratings agencies. The credit ratings at the company’s subsidiaries were also upgraded.

“FirstEnergy has a straightforward, transparent operating model and a culture focused on continuous improvement and driving results, making us well-positioned to become a premier electric company benefiting our customers, investors, communities and employees,” said Tierney.

Akron, Ohio-based FirstEnergy’s 10 regulated distribution companies form one of the nation’s largest investor-owned electric systems, serving six million customers in the Midwest and Mid-Atlantic regions.

Stretching from the Ohio-Indiana border to the New Jersey shore, the companies operate a massive infrastructure of more than 269,000 miles of distribution lines.

The post FirstEnergy gains $1.2B in proceeds as sale of transmission subsidiary gets finalized appeared first on Daily Energy Insider .