Brookfield Super-Core Infrastructure Partners to Acquire Stake in FirstEnergy Transmission

Posted on 02/03/2023

FirstEnergy Corp. (NYSE: FE) entered into a definitive agreement to sell an additional 30% ownership interest in its FirstEnergy Transmission, LLC (FET) business to Brookfield Super-Core Infrastructure Partners (Brookfield Asset Management). Upon closing of the transaction, proceeds from the US$ 3.5 billion all-cash deal. Brookfield Super-Core Infrastructure Partners is a perpetual fund that invests in low-risk assets.

FirstEnergy Transmission, LLC is the holding company for three of FirstEnergy’s FERC-regulated transmission utility subsidiaries: American Transmission Systems, Incorporated (ATSI); Mid-Atlantic Interstate Transmission, LLC (MAIT); and Trans-Allegheny Interstate Line Company (TrAILCo) – which comprise one of the largest transmission systems in PJM. FirstEnergy also owns transmission assets in New Jersey, Pennsylvania, West Virginia and Maryland that are not part of FET.

In May 2022, FirstEnergy completed the sale of a 19.9% non-controlling interest in FET to Brookfield. Upon closing of the transaction announced today, FirstEnergy will remain the majority owner of FET, and FirstEnergy’s workforce will continue to operate the business. FirstEnergy will retain nearly 70% of its overall regulated transmission portfolio.

During 2022, FirstEnergy reduced holding company debt by US$ 2.5 billion, or more than 30% compared to year-end 2021. The transaction is expected to close by early 2024, subject to customary closing conditions, including receiving applicable regulatory approvals and clearances.

J. P. Morgan Securities LLC is serving as lead financial advisor and Citigroup Global Markets is serving as financial advisor to FirstEnergy for this transaction. Moelis & Company LLC is serving as financial advisor and provided a fairness opinion to the FirstEnergy Board of Directors. Jones Day is serving as legal advisor to FirstEnergy. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to Brookfield.

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