Elliott lawyer says third
bidder may top Buffett's Oncor bid
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[August 19, 2017]
By Jessica DiNapoli and David French
(Reuters) - An unidentified utility could
pay $9.3 billion to buy Texas power transmission company Oncor Electric
Delivery Co, topping Berkshire Hathaway Inc's $9 billion bid, a lawyer
for the largest creditor of Oncor's parent told a U.S. bankruptcy judge
Such a bid would add to the competition that Warren Buffett, Berkshire's
chief executive, faces for Oncor and could cause the Texas company to
slip from his grasp.
It could also scuttle plans of billionaire Paul Singer's hedge fund
Elliott Management Corp, the largest creditor of Oncor's bankrupt
parent, Energy Future Holdings Corp. Elliott has been trying to block
Oncor's sale to Berkshire and put together its own consortium to buy the
A source close to Energy Future, speaking on condition of anonymity,
said it had already received a $9.3 billion offer for Oncor, but would
not disclose the bidder's identity or other details.
An Elliott spokesman declined to comment on the identity of the utility,
which the firm's lawyer referred to in a public conference call with the
judge, ahead of a scheduled Monday court hearing.
Energy Future did not immediately respond to a request for comment.
Berkshire has said its deal represents the best chance for Oncor to
emerge from more than three years of bankruptcy, but that it will walk
away if the takeover does not win court approval at the Monday hearing.
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Berkshire Hathaway CEO Warren Buffett plays bridge during the
Berkshire annual meeting weekend in Omaha, Nebraska, U.S. on May 3,
2015. REUTERS/Rick Wilking/File Photo
On Wednesday, Berkshire said it stood by its $9 billion offer and would not
On Friday evening, after news of the third bidder surfaced, Berkshire said its
offer had won support from five more Texas stakeholder groups. It said these
included staff of the Public Utility Commission of Texas, a regulator whose
approval is needed for an Oncor takeover.
Any approval would likely involve ringfencing, restricting a buyer's ability to
tap Oncor's cash and place more debt on it.
Earlier this year, the regulator shot down the sale of Oncor to NextEra Energy
Inc because it considered the proposed financial structure too risky for
A separate plan to sell Oncor to a group of creditors and investors led by
privately held Hunt Consolidated Inc of Texas collapsed in 2016, after hitting
obstacles at the regulator.
Berkshire's all-cash bid has won praise from the commission's executive
director, Brian Lloyd.
(Reporting by Jessica DiNapoli and David French in New York; Additional
reporting by Jonathan Stempel; Editing by Tom Brown and Leslie Adler)
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