Delta Utilities, backed by Bernhard Capital Partners, plans to acquire CenterPoint Energy’s natural gas assets in Louisiana and Mississippi for $1.2 billion as part of a strategic expansion in the utility sector.

Information on the Target

In February 2024, Delta Utilities, backed by Bernhard Capital Partners, agreed to acquire the Louisiana and Mississippi natural gas assets of CenterPoint Energy for $1.2 billion. This acquisition reflects a significant 32x multiple on the assets' Local Distribution Company (LDC) earnings. The target assets encompass approximately 12,000 miles of pipeline, serving around 380,000 metered customers, highlighting the scale and strategic importance of the deal in the regional utility sector.

Delta Utilities was established in 2023 as a regulated natural gas utility with a main objective of delivering safe and reliable natural gas distribution. The company's aggressive acquisition strategy is evidenced by its announcement in October 2023 to acquire Entergy’s natural gas distribution operations in New Orleans and Baton Rouge, demonstrating its commitment to expanding its footprint in the natural gas sector. Both transactions are projected to close in 2025.

Industry Overview in Louisiana

The merger and acquisition landscape in Louisiana has been under significant pressure, with 2024 witnessing a decrease in activity for the second consecutive year. A total of 171 transactions involving Louisiana-targeted entities were reported,