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HomeAll newsMost read newsBusiness Leaders Biography
Birthday : 08/30/1930
Place of birth : Omaha (Omaha) - United States
Biography : Warren Edward Buffett is an American businessperson who has been at the helm of 6 different companie

Buffett's Berkshire to buy Dominion Energy gas assets for $4 billion

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07/05/2020 | 03:34pm EDT
Berkshire Hathaway Chairman Warren Buffett walks through the exhibit hall as shareholders gather to hear from the billionaire investor at Berkshire Hathaway Inc's annual shareholder meeting in Omaha

By Jonathan Stempel

Berkshire Hathaway Inc said its energy unit will buy Dominion Energy Inc's natural gas transmission and storage network for $4 billion, helping billionaire Chairman Warren Buffett reduce his conglomerate's cash pile while letting Dominion focus on utilities operations.

The transaction announced on Sunday includes more than 7,700 miles (12,390 km) of natural gas transmission lines and 900 billion cubic feet of gas storage.

Berkshire Hathaway Energy is buying Dominion Energy Transmission, Questar Pipeline, Carolina Gas Transmission, 50% of the Iroquois Gas Transmission System, and 25% of the Cove Point liquefied natural gas facility in Maryland.

Dominion will retain 50% of Cove Point. Brookfield Asset Management Inc owns 25%.

The Berkshire unit will also assume $5.7 billion of debt, giving the transaction a $9.7 billion enterprise value. It expects a fourth-quarter closing, pending regulatory approvals.

"We are very proud to be adding such a great portfolio of natural gas assets to our already strong energy business," Buffett said in a statement.

Dominion expects up to 90% of future operating earnings to come from utilities.

The company and Duke Energy Inc separately announced on Sunday they would abandon their $8 billion Atlantic Coast Pipeline, running under the Appalachian Trail and through West Virginia, Virginia and North Carolina.

Dominion and Duke cited delays and uncertain costs, despite a favorable U.S. Supreme Court decision last month.

Berkshire controls 91.1% of Berkshire Hathaway Energy, which owns the MidAmerican Energy, NV Energy and PacifiCorp utilities, natural gas pipelines, wind power assets and electricity businesses in Britain and Canada.

The unit accounted for 12% of Berkshire's $23.97 billion of operating profit in 2019. Its chairman, Greg Abel, is also a Berkshire vice chairman.

Berkshire ended March with $137.2 billion of cash, reflecting Buffett's four-year inability to find major acquisitions, even as the coronavirus pandemic took hold and stock prices plunged.

Berkshire Hathaway Energy declined additional comment.

(Reporting by Maria Ponnezhath in Bengaluru and Jonathan Stempel in New York; Editing by Peter Cooney)

Stocks mentioned in the article
ChangeLast1st jan.
BERKSHIRE HATHAWAY INC. 2.00% 299455 Delayed Quote.-13.53%
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