Centerpoint Energy Inc.

Utilities - Regulated Electric • Utilities • Houston, TX, United States • CNP (NYQ)

713 207 1111 1111 Louisiana Street, Houston, TX 77002, United States

Quarter: Q4 2026 Reported: October 21, 2025 Sentiment: Positive

CenterPoint Energy, Inc. operates as a public utility holding company in the United States. The company operates in Electric and Natural Gas segments. The Electric segment provides electric transmission and distribution services to electric customers and electric generation assets, as well as optimizes assets in the wholesale power market in Indiana Electric's service territory. The Natural Gas segment engages in the intrastate natural gas sales, and natural gas transportation and distribution for residential, commercial, and industrial customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas; permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies; and provides home appliance maintenance and repair services to customers in Minnesota and home repair protection plans to natural gas customers in Indiana, Mississippi, Ohio, and Texas through a third party. As of December 31, 2024, it served approximately 2,818,343 metered customers; owned 352 substations with transformer capacity of 80,659 megavolt amperes; and owned and operated approximately 219 miles of intrastate pipeline in Louisiana and Texas. The company was founded in 1866 and is headquartered in Houston, Texas.

Analysis Summary

CenterPoint Energy, through its wholly-owned indirect subsidiary CenterPoint Energy Resources Corp. (Seller), has announced a significant strategic divestiture: the sale of all issued and outstanding equity interests in Vectren Energy Delivery of Ohio, LLC (VEDO) to National Fuel Gas Company (Buyer). The total purchase price for VEDO is $2.62 billion, structured with a substantial cash component and a short-term financing arrangement. Specifically, the Buyer will pay $1.42 billion in cash at the closing, subject to customary adjustments for net working capital, regulatory assets/liabilities, and capital expenditures. The remaining $1.2 billion will be facilitated through a 364-day seller promissory note, issued by the Buyer to the Seller, bearing an annual interest rate of 6.5%, payable quarterly. This note is non-prepayable without the Lender's consent, and its proceeds upon maturity are intended for CenterPoint's general corporate purposes.

The completion of this Transaction is contingent upon several standard closing conditions, including the expiration or termination of the Hart-Scott-Rodino Antitrust Improvements Act waiting period and a notice filing and review with the Public Utilities Commission of Ohio. The deal is not subject to a financing condition, underscoring the Buyer's commitment. The parties have agreed to customary interim operating covenants for VEDO, ensuring its operation in the ordinary course of business until closing, and post-closing cooperation covenants for transition services and shared contracts. The expected closing date is Q4 2026, with an inside date of October 1, 2026. The Purchase Agreement includes provisions for extending the term up to 24 months under certain conditions related to regulatory approvals and outlines a termination fee payable by the Buyer in specific scenarios of material breach or regulatory restraints.

While this filing does not provide Q4 2026 earnings figures, the divestiture represents a significant portfolio optimization for CenterPoint. The structured payment, including the seller note with a 6.5% interest rate, provides both immediate capital and a short-term income stream. The covenants associated with the seller note, such as the consolidated indebtedness to capitalization ratio limit of 0.65 to 1.0 for the Buyer, offer a degree of financial protection for CenterPoint as the lender. The transaction's success hinges on timely regulatory approvals, which are explicitly highlighted as potential risk factors. This strategic move is expected to enhance CenterPoint's financial flexibility and focus on its core operations, although the specific strategic rationale beyond 'general corporate purposes' is not detailed in this filing.

Key Highlights

• CenterPoint Energy to sell Vectren Energy Delivery of Ohio (VEDO) to National Fuel Gas Company.
• Total purchase price is $2.62 billion.
• Payment includes $1.42 billion cash and a $1.2 billion 364-day seller promissory note.
• Seller note bears 6.5% annual interest, payable quarterly.
• Transaction expected to close in Q4 2026, subject to regulatory approvals.
• Proceeds from the seller note repayment are for general corporate purposes.
• Closing conditions include Hart-Scott-Rodino and Ohio PUC review.

Financial Metrics

eps

N/A (not an earnings report)

YoY: N/A

revenue

2.62 billion

YoY: N/A (one-time transaction)

guidance

net income

N/A (transaction proceeds, not income statement item)

YoY: N/A

Stock Performance (90 Days)

Data through Jan 16, 2026

Layoff Events

Earnings Calls

Positive Signals

• Definitive agreement signed for a significant asset sale.
• Clear and structured payment terms, including a substantial cash component.
• Seller promissory note provides a fixed interest income stream (6.5%).
• Transaction is not subject to a financing condition for the buyer.
• Detailed closing conditions and termination provisions are outlined.

Risks & Concerns

— Timing of regulatory approvals (Hart-Scott-Rodino, Ohio PUC) may delay closing.
— Potential for conditions to closing not being satisfied.
— Risk of legal or regulatory proceedings related to the transaction.
— Disruption from the transaction making it difficult to maintain relationships with stakeholders.
— Diversion of management time and attention on the transaction.