Southwest Gas trims Centuri stake, secures up to $247M for debt paydown

Rhea-AI Filing Summary

Southwest Gas Holdings, Inc. (NYSE: SWX) has monetised part of its majority stake in its infrastructure-services subsidiary, Centuri Holdings, Inc., through a public secondary offering and a concurrent private placement disclosed in this Form 8-K.

Underwritten offering: On 18 June 2025 the company closed the sale of 11,212,500 Centuri shares (including the underwriters’ full over-allotment) at $20.75 per share. Net cash to Southwest Gas was ≈ $225 million after underwriting discounts and commissions. Centuri did not receive proceeds because all shares were sold by the parent.

Post-transaction ownership: Southwest Gas now holds 47,245,950 Centuri shares (≈ 53.3% of outstanding). If a separate private placement closes, ownership will fall modestly to ≈ 52.1%, preserving majority control.

Concurrent private placement: On 13 June 2025 the company signed a Stock Purchase Agreement with Icahn Partners LP and Icahn Partners Master Fund LP to sell an additional 1,060,240 Centuri shares at the same $20.75 price, yielding expected net proceeds of ≈ $22 million. Closing is contingent on Hart-Scott-Rodino clearance and must occur by 9 July 2025 or the agreement terminates.

Use of proceeds: Management states all cash raised (up to ≈ $247 million combined) will be applied to repay outstanding indebtedness, improving the parent company’s leverage profile.

Lock-up provisions: Centuri, its directors/officers, Southwest Gas and the Icahn Investors have agreed not to sell additional Centuri stock for 45 days following the prospectus supplement, limiting near-term share supply.

Documentation: The 8-K files the Underwriting Agreement (Ex. 10.1) and Stock Purchase Agreement (Ex. 10.2), which contain customary representations, warranties, covenants and indemnities.

Strategic context: The transactions convert a minority portion of Centuri equity into cash while leaving Southwest Gas with majority voting control. Proceeds earmarked for debt reduction may lower interest expense and strengthen the balance sheet, though investors should weigh the reduced economic participation in Centuri’s future growth.

Positive

• $225 million net proceeds already received, with a further $22 million expected, providing material cash for debt repayment.
• Company retains majority control of Centuri (≥ 52%) despite share sale.
• Underwriters exercised their full option, indicating strong market demand for Centuri shares.
• 45-day lock-up agreements limit additional share sales, reducing near-term selling pressure.

Negative

• Stake in Centuri diluted from ~54% to ~52%, lowering long-term economic participation in subsidiary growth.
• Concurrent private placement is contingent on HSR clearance; failure would forfeit ≈ $22 million of expected proceeds.
• Sale proceeds are modest relative to ≈ $4 billion consolidated debt, offering only incremental leverage relief.

Insights

Financial Analyst

TL;DR: $247 m cash raised, majority control retained; net positive for leverage improvement.

The fully subscribed public offering and pending private sale give Southwest Gas up to $247 million of fresh liquidity dedicated to debt repayment. Given YE 2024 consolidated net debt of roughly $4 billion, the inflow could trim leverage by ~0.1-0.2x EBITDA—modest, yet directionally favourable. Importantly, the company still owns >52% of Centuri, so it continues to consolidate the asset and capture synergies, while freeing value for core utility capital needs. Strong demand (full exercise of the 15% over-allotment) and a 45-day lock-up reduce market overhang. Rating: slight positive.

Risk Analyst

TL;DR: Ownership dilution and regulatory condition add mild uncertainty; overall neutral.

The sale decreases Southwest Gas’s stake in a growth platform from 54%+ to ~52%, trimming future upside. The $20.75 pricing—roughly 9× forward EBITDA—may signal limited valuation uplift versus peer comps. The private placement hinges on HSR clearance; failure would leave the company short of projected proceeds. While leverage edges lower, the reduction is marginal against sizeable debt maturities. Lock-up is short at 45 days, after which further share supply could pressure Centuri’s stock price. Rating: neutral.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) June 13, 2025

SOUTHWEST GAS HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware		001-37976		81-3881866
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

8360 S. Durango Drive

Post Office Box 98510

Las Vegas, Nevada

(Address of principal executive offices)

89193-8510

(Zip Code)

Registrant’s telephone number, including area code: (702) 876-7237

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol		Name of each exchange on which registered
Southwest Gas Holdings, Inc. Common Stock, $1 Par Value		SWX		New York Stock Exchange

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry Into a Material Definitive Agreement.

Underwritten Offering

On June 16, 2025, Southwest Gas Holdings, Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with J.P. Morgan Securities LLC, as representative (the “Representative”) of the several underwriters named therein (collectively, the “Underwriters”) and Centuri Holdings, Inc. (“Centuri”), pursuant to which the Company agreed to sell 9,750,000 shares (the “Initial Shares”) of its holdings of common stock of Centuri, par value $0.01 per share (“Centuri Common Stock”), to the Underwriters (the “Offering”). The price to the public in the Offering was $20.75 per share (the “Offering Price”). In addition, under the terms of the Underwriting Agreement, the Company granted the Underwriters the option, for 30 days after the date of the prospectus supplement specifically relating to the Offering (the “Prospectus Supplement”), to purchase up to 1,462,500 additional shares of its holdings of Centuri Common Stock (the “Additional Shares” and, together with the Initial Shares, the “Shares”) at the Offering Price, less underwriting discounts and commissions.

The Offering was made under the Prospectus Supplement and related prospectus filed with the Securities and Exchange Commission pursuant to Centuri’s effective shelf registration statement on Form S-3, as amended (Registration No. 333-287200).

Under the terms of the Underwriting Agreement and pursuant to a lock-up agreement, Centuri, Centuri’s directors and executive officers, the Company, the Icahn Investors (as defined below) and certain of their respective affiliates also agreed not to sell or transfer any Centuri Common Stock without first obtaining the written consent of the Representative, subject to certain exceptions, for 45 days after the date of the Prospectus Supplement.

On June 18, 2025, the Offering closed, pursuant to which the Company sold a total of 11,212,500 shares of Centuri Common Stock, which included the Underwriters’ full exercise of their option to purchase the Additional Shares described above. The Company received net proceeds of approximately $225 million in respect of the sale of the Shares, after deducting the Underwriters’ discounts and commissions. Centuri did not receive any of the proceeds from the sale of the Shares by the Company. The Company intends to use the proceeds from the Offering and the Concurrent Private Placement (as defined below) for the repayment of outstanding indebtedness.

As of the closing of the Offering, the Company owns 47,245,950 shares of Centuri Common Stock, or approximately 53.3% of the total outstanding shares of Centuri Common Stock. Upon completion of the Concurrent Private Placement (as defined below), if effected, the Company will own 46,185,710 shares of Centuri Common Stock, or approximately 52.1% of the total outstanding shares of Centuri Common Stock.

The Underwriting Agreement contains customary representations, warranties, covenants, indemnification obligations of Centuri, the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, and other obligations of the parties. The representations, warranties and covenants contained in the Underwriting Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties. A copy of the Underwriting Agreement is filed as Exhibit 10.1 hereto and is incorporated herein by reference. The foregoing description of the Underwriting Agreement does not purport to be complete and is qualified in its entirety by reference to such exhibit.

Concurrent Private Placement

As described in the Prospectus Supplement, on June 13, 2025, the Company entered into that certain Common Stock Purchase Agreement (the “Stock Purchase Agreement”) with Icahn Partners LP and Icahn Partners Master Fund LP, investment entities affiliated with Carl C. Icahn (collectively, the “Icahn Investors”), pursuant to which the Company agreed to sell an aggregate of 1,060,240 shares of its holdings of Centuri Common Stock in a concurrent private placement to the Icahn Investors at the Offering Price (the “Concurrent Private Placement”). The closing of the Concurrent Private Placement is contingent upon the expiration or early termination of the applicable waiting period relating to the premerger notification and report forms required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, including the rules and regulations thereunder (the “HSR Act”), and is expected to occur on the first business day after the expiration or early termination of such waiting period; provided that, if the closing has not occurred by July 9, 2025, the Stock Purchase Agreement will terminate without the

sale of shares to the Icahn Investors. The sale of the Centuri Common Stock in the Concurrent Private Placement, if effected, will not be registered under the Securities Act of 1933, as amended (the “Securities Act”). The net proceeds to the Company from the Concurrent Private Placement are expected to be approximately $22 million. Centuri will not receive any of the proceeds from the Concurrent Private Placement by the Company.

The Stock Purchase Agreement contains customary representations, warranties, covenants, indemnification obligations of the Company and the Icahn Investors, including for liabilities under the Securities Act, and other obligations of the parties. The representations, warranties and covenants contained in the Stock Purchase Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties. A copy of the Stock Purchase Agreement is filed as Exhibit 10.2 hereto and is incorporated herein by reference. The foregoing descriptions of the Stock Purchase Agreement do not purport to be complete and are qualified in their entirety by reference to such exhibit.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.		Description
10.1+		Underwriting Agreement, dated as of June 16, 2025, by and among Centuri Holdings Inc., Southwest Gas Holdings, Inc. and J.P. Morgan Securities LLC, as representative of the underwriters named therein.
10.2*		Common Stock Purchase Agreement, dated as of June 13, 2025, by and among Southwest Gas Holdings, Inc., Icahn Partners LP and Icahn Partners Master Fund LP.
104		Cover Page formatted in Inline XBRL

+ Certain of the schedules and attachments to this exhibit have been omitted in accordance with Regulation S-K, Item 601(a)(5). The registrant hereby undertakes to provide further information regarding such omitted materials to the SEC upon request.

* Certain personal information in this exhibit has been omitted in accordance with Regulation S-K Item 601(a)(6).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

						SOUTHWEST GAS HOLDINGS, INC.
June 18, 2025						/s/ Robert J. Stefani
						Robert J. Stefani
						Senior Vice President/Chief Financial Officer

FAQ

How much cash did Southwest Gas (SWX) raise from selling Centuri shares?

The underwritten offering generated ≈ $225 million net; an additional ≈ $22 million may come from the private placement.

What percentage of Centuri does Southwest Gas own after the transaction?

As of 18 June 2025 SWX owns 53.3% of Centuri; this will fall to ≈ 52.1% if the private placement closes.

What will Southwest Gas do with the proceeds from the Centuri share sale?

Management intends to repay outstanding indebtedness, improving the company’s leverage position.

Who bought the additional Centuri shares in the private placement?

Icahn Partners LP and Icahn Partners Master Fund LP agreed to purchase 1,060,240 shares at $20.75 per share.

What is the lock-up period for further Centuri share sales?

Centuri, SWX, insiders and Icahn entities agreed to a 45-day lock-up following the prospectus supplement date.