CenterPoint Energy Sells Ohio Natural Gas Business to National Fuel Gas for $2.62 Billion
CenterPoint Energy, Inc. (NYSE: CNP) today announced a landmark agreement to sell its Ohio natural gas Local Distribution Company (LDC) business, Vectren Energy Delivery of Ohio, LLC, to National Fuel Gas Company (NYSE: NFG), a diversified energy company headquartered in Western New York, for a total consideration of $2.62 billion. The transaction includes a substantial portfolio of assets, comprising approximately 5,900 miles of transmission and distribution pipelines in Ohio, which currently serve roughly 335,000 metered customers across the region.
The agreed-upon sales price represents an approximately 1.9x multiple of the 2024 Ohio LDC rate base, reflecting the strong performance and long-term growth prospects of the business. As with all major utility transactions, the deal is subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act and review and approval from the Public Utilities Commission of Ohio (PUCO). CenterPoint anticipates that the transaction will close during the fourth quarter of 2026.
The financial structure of the transaction includes staggered proceeds. CenterPoint expects to receive $1.42 billion at closing in 2026, with the remaining $1.20 billion to be received in 2027 pursuant to a seller note executed at the time of closing. This approach allows for efficient capital recycling while maintaining operational continuity.
Jason Wells, Chair and Chief Executive Officer of CenterPoint Energy, emphasized the significance of the transaction for both the company and its customers:
“Our Ohio natural gas business is a strong and growing enterprise supported by a deeply committed local team focused on safety, excellence in execution, and delivering positive outcomes for customers. I would like to thank our Ohio natural gas employees and the other team members across CenterPoint who support this business for their continued dedication and service as we move through this process. Together with National Fuel, we will be focused on delivering a seamless transition for the approximately 335,000 customers in West Central Ohio, and we are confident that National Fuel will support the continued growth and success of the business for the benefit of customers, communities, and employees.”
The transaction aligns with CenterPoint’s strategic portfolio management objectives. By divesting the Ohio LDC, the company expects to optimize its utility portfolio and redeploy more than $2 billion into its core electric and natural gas operations across Texas, Indiana, and Minnesota. According to Wells, the proceeds will contribute to CenterPoint’s refreshed 10-year capital plan, supporting the company’s ambition to deliver industry-leading earnings growth while continuing to invest in customer-centric infrastructure initiatives.
“As we shared recently, as part of our refreshed 10-year capital plan, this transaction will allow us to continue to optimize our portfolio of utility operations and efficiently recycle more than $2 billion back into our other electric and natural gas businesses, which will help fuel our industry-leading earnings growth over the next 10 years,” Wells added.
Despite the divestiture, CenterPoint emphasized that its natural gas business remains a cornerstone of its overall strategy. The company continues to operate and invest in its significant natural gas operations across its Texas, Indiana, and Minnesota service territories, where it maintains large customer bases and robust investment pipelines. The sale of the Ohio assets allows the company to focus on areas where it can drive higher strategic impact and operational efficiencies.
“While we have executed several gas LDC transactions in the last few years to help continue to drive our growth, our natural gas business remains core to our overall company strategy of providing secure and reliable energy to millions of customers across Texas, Indiana, and Minnesota where we have significant footprints and customer-centric investment plans,” Wells stated.
From an operational standpoint, the transaction is expected to be seamless for existing customers, with National Fuel committed to continuing safe and reliable gas service. Employees of the Ohio LDC will play a critical role in ensuring continuity, and both companies have highlighted a shared focus on community engagement and customer satisfaction.
CenterPoint’s financial advisors for the transaction were Goldman Sachs & Co. LLC and Guggenheim Securities, LLC, while its legal advisors included Gibson, Dunn & Crutcher LLP, Barnes & Thornburg LLP, Bricker Graydon LLP, and Whitt Sturtevant LLP. The involvement of these advisory firms underscores the strategic importance of the transaction and ensures comprehensive oversight and regulatory compliance throughout the closing process.
National Fuel Gas Company, the acquiring entity, brings extensive experience in operating natural gas utilities and a strong track record in customer service and community engagement. The acquisition of Vectren Energy Delivery of Ohio expands National Fuel’s geographic footprint and strengthens its position as a leading provider of natural gas services in the U.S.
The divestiture also reflects broader trends in the energy sector, where utility companies are increasingly refining their portfolios to focus on regions and business lines that offer the highest strategic value. By focusing on core operations and selectively divesting non-core assets, companies like CenterPoint can enhance operational efficiency, deploy capital more effectively, and sustain long-term growth for shareholders and customers alike.
