On November 7, 2023, Sempra (the “Company”) entered into (a) forward sale agreements with each of Morgan Stanley & Co. LLC and Citibank, N.A. (collectively, the “forward purchasers”), and (b) an underwriting agreement with Morgan Stanley & Co. LLC and Citigroup Global Markets Inc., as representatives of the several underwriters named in Schedule I thereto (the “Underwriters”), and the forward sellers party thereto. The underwriting agreement provides for the public offering and sale of 17,142,858 shares of the Company’s common stock at a public offering price of $70.00 per share (the “Offering”).
The forward purchasers or their affiliates borrowed and sold an aggregate of 17,142,858 shares of the Company’s common stock to the Underwriters on November 10, 2023 in connection with the closing of the Offering on such date. The Company intends (subject to the Company’s right to elect cash or net share settlement subject to certain conditions) to issue and sell, upon physical settlement of the forward sale agreements on one or more dates specified by the Company occurring no later than December 31, 2024, an aggregate of 17,142,858 shares of the Company’s common stock to the forward purchasers at an initial forward sale price of $68.8450 per share, subject to certain adjustments as provided in the forward sale agreements.
The Company granted the Underwriters an option to purchase up to an additional 2,571,428 shares of the Company’s common stock directly from the Company, solely to cover over-allotments, if any, which option was exercised in part for 2,099,152 shares on November 8, 2023 and the remainder of which remains exercisable until December 7, 2023.
The Company estimates its net proceeds from the sale of shares of its common stock pursuant to the forward sale agreements (after deducting underwriting discounts but before deducting the Company’s other offering expenses estimated at $600,000) will be approximately $1.180 billion, subject to certain adjustments to the forward sale price pursuant to the forward sale agreements and assuming full physical settlement of the forward sale agreements. Proceeds to the Company at the closing of the Offering (after deducting underwriting discounts but before deducting the Company’s other offering expenses estimated at $600,000) were approximately $144.5 million in connection with the Underwriters’ partial exercise of their over-allotment option.
The shares are being offered under a prospectus supplement and related prospectus filed with the U.S. Securities and Exchange Commission pursuant to the Company’s effective shelf registration statement on Form S-3 (File No. 333-272237) (the “Shelf Registration Statement”). Copies of the underwriting agreement and each forward sale agreement are attached as exhibits to this Current Report on Form 8-K and are incorporated herein by reference. The summary set forth above is qualified in its entirety by reference to such exhibits.
Information Regarding Forward-Looking Statements
This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions about the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed or implied in any forward-looking statement. These forward-looking statements represent our estimates and assumptions only as of the filing date of this report. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise.
Forward-looking statements can be identified by words such as “believe,” “expect,” “intend,” “anticipate,” “contemplate,” “plan,” “estimate,” “project,” “forecast,” “should,” “could,” “would,” “will,” “confident,” “may,” “can,” “potential,” “possible,” “proposed,” “in process,” “construct,” “develop,” “opportunity,” “initiative,” “target,” “outlook,” “optimistic,” “poised,” “maintain,” “continue,” “progress,” “advance,” “goal,” “aim,” “commit,” or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations. Such forward–looking statements include, among other things, statements regarding the Company’s intention to physically settle the forward sale agreements, as opposed to cash or net share settlement, and statements regarding whether the underwriters exercise their option to purchase additional shares of the Company’s common stock, solely to cover over-allotments, if any.
Factors, among others, that could cause actual results and events to differ materially from those expressed or implied in any forward-looking statement include: California wildfires, including potential liability for damages regardless of fault and any inability to recover all or a substantial portion of costs from insurance, the wildfire fund established by California Assembly Bill 1054, rates from customers or a combination thereof; decisions, investigations, inquiries, regulations, denials or revocations of permits, consents, approvals or other authorizations, renewals of franchises, and other actions by the (i) California Public Utilities Commission (CPUC), Comisión Reguladora de Energía (Mexico’s Energy Regulatory Commission), U.S. Department of Energy, U.S. Federal Energy Regulatory Commission, Public Utility Commission of Texas, U.S. Internal Revenue Service, and other governmental and regulatory bodies and (ii) U.S., Mexico and states, counties, cities and other jurisdictions therein and in other countries where we do business; the success of business development efforts, construction projects, acquisitions,
