Item 2.01 Completion of Acquisition or Disposition of Assets
On April 24, 2020, Sempra Energy International Holdings N.V. (“International Holdings”), an indirect wholly owned subsidiary of Sempra Energy, completed the sale, previously announced on September 30, 2019, of its 83.6% indirect interest in Luz del Sur S.A.A. (“Luz del Sur”) and its indirect interest in Tecsur S.A. (“Tecsur”) to an affiliate of China Yangtze Power International (Hongkong) Co., Limited (“CYP International”). Pursuant to the Purchase and Sale Agreement dated as of September 27, 2019, by and between International Holdings and CYP International (the “Purchase and Sale Agreement”), International Holdings sold to CYP International's affiliate 100% of the outstanding interests of Peruvian Opportunity Company S.A.C. and Sempra Americas Bermuda Ltd., which collectively own the direct and indirect interests in Luz del Sur and Tecsur that were sold in the transaction, for an aggregate base purchase price of $3.59 billion, subject to post-closing adjustments. The 16.4% interest in Luz del Sur that was not sold in the transaction represents shares that are traded on the Lima Stock Exchange (Bolsa de Valores de Lima) under the symbol LUSURC1.
Luz del Sur is an electric distribution utility that serves a population of approximately 4.9 million in the southern zone of metropolitan Lima, Peru, with a service area covering approximately 1,400 square miles. Inland Energy S.A.C., a subsidiary of Luz del Sur, owns and operates Santa Teresa, a 100-megawatt hydroelectric power plant located in the Cusco region of Peru. Tecsur is an energy-services company that provides electric construction and infrastructure services to Luz del Sur as well as third parties.
As a result of this disposition, Sempra Energy expects to recognize a gain on sale of approximately $2.3 billion ($1.5 billion after tax), subject to post-closing adjustments.
The Purchase and Sale Agreement and the transactions contemplated thereby are more fully described in Sempra Energy’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on September 30, 2019, which description is incorporated herein by reference. Such description and the foregoing description do not purport to be complete and are subject to, and qualified in their entirety by, the full text of the Purchase and Sale Agreement, which is filed as Exhibit 2.1 hereto and to such Current Report on Form 8-K and is incorporated herein by reference.