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Southwest Gas targets spring/summer 2024 for Centuri IPO

Published 04/12/2023, 15:20
Updated 04/12/2023, 16:26
© Reuters.

LAS VEGAS - Southwest Gas (NYSE:SWX) Holdings Inc has announced its plans to take its subsidiary, Centuri Holdings, public with an initial public offering (IPO) slated for spring or summer of 2024. This strategic move comes as the company prepares for a leadership transition, with Centuri's current CEO, Paul M. Daily, set to retire in the same year.

The decision to pursue an IPO aligns with Southwest Gas's broader financial strategy. The company aims to utilize the proceeds from the public offering to pay down its debt. The Company also retains strategic flexibility to separate Centuri through a tax-free spin-off of all or a part of Centuri in the event market conditions are not conducive to an IPO or secondary sales by Southwest Gas following an IPO. The company has a substantial $932.8 million federal net operating loss carryforward that could mitigate taxable gains from the sale of Centuri shares.

As part of this process, Southwest Gas is actively searching for a new CEO to lead Centuri into its next phase. This announcement comes after a confidential draft IPO registration was submitted on September 22, 2023, signaling the company's intention to go public.

The upcoming IPO is particularly significant given Southwest Gas's stock performance over the past year. As of year-to-date figures in 2023, SWX shares have seen a decline of 2.5%, which contrasts sharply with the S&P 500's rise of 19.7% over the same period.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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