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Sources: Excelerate Energy close to $1 billion deal with New Fortress Jamaica unit

According to sources familiar with the situation, Excelerate Energy, a provider of liquefied natural gas infrastructures is close to completing a deal for the Jamaican business of its smaller rival New Fortress Energy. The price will be around $1.1 billion.

Sources who asked to remain anonymous in order to discuss their private discussions said that if the negotiations are successful, a deal could be announced by Thursday.

Excelerate expects the all-cash transaction to increase its global footprint. Its LNG infrastructure is currently deployed in Bangladesh, Brazil and Finland, among other countries.

New Fortress will also be able to address its financial problems, which forced it to sell some of its premium assets.

Excelerate and New Fortress were not immediately available for comment.

Excelerate and New Fortress both provide floating LNG terminals that allow countries to import gas without the need to build large-scale installations, which can be expensive and take many years to build.

According to a November presentation, New Fortress' Jamaica operations consist of the Montego Bay onshore and floating terminals, as well as the Clarendon combined heating and power plant, which supplies 65% the island's electrical energy.

The company stated earlier in March that it hoped for a $2 billion raise from the sale of assets, including its businesses in Jamaica, Brazil and other countries. It added that the proceeds will be used to pay down its debt, which was $8.4 billion by the end 2024.

New Fortress began exploring options in October after it was forced to delay dividend payments to shareholders while holding talks with bondholders about near-term debt maturity.

It announced in November that it had closed a number of financing transactions to relieve its cash shortage. These included the exchange of bonds for notes with longer maturities and the issuance of new equity. (Reporting and editing by Leslie Adler in New York, David French reported from New York)

(source: Reuters)