8-K: Centuri Holdings Completes Major Secondary Offering and Private Placement, Icahn Investors Increase Stake

Centuri Holdings, Inc. announced the completion of a public offering by Southwest Gas Holdings, Inc. of 11.2 million shares of Centuri common stock for approximately $225 million, alongside a concurrent $22 million private placement to Icahn Investors, with Centuri not receiving any proceeds from either transaction.

Summary

• Southwest Gas Holdings, Inc. completed a public offering of 11,212,500 shares of Centuri Holdings, Inc. common stock on June 18, 2025.
• The shares were sold at $20.75 per share, generating approximately $225 million in net proceeds for Southwest Gas Holdings, Inc.
• Centuri Holdings, Inc. did not receive any proceeds from this public offering.
• Concurrently, Southwest Gas Holdings, Inc. entered into a private placement agreement on June 13, 2025, to sell 1,060,240 shares of Centuri common stock to Icahn Partners LP and Icahn Partners Master Fund LP at the public offering price of $20.75 per share.
• This private placement is expected to generate approximately $22 million in net proceeds for Southwest Gas Holdings, Inc., and Centuri Holdings, Inc. will not receive any proceeds.
• The private placement closing is contingent on the expiration or early termination of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 waiting period and is expected to close on the first business day thereafter, but will terminate if not closed by July 9, 2025.
• Following the public offering, Southwest Gas Holdings, Inc. owns approximately 53.3% (47,245,950 shares) of Centuri's total outstanding common stock.
• Upon completion of the private placement, Southwest Gas Holdings, Inc.'s ownership will decrease to approximately 52.1% (46,185,710 shares).
• Centuri Holdings, Inc. has granted Icahn Investors certain resale registration rights for the shares acquired in the private placement, requiring registration no later than 181 days after May 22, 2025.
• A 45-day lock-up period is in effect for Centuri, its directors, executive officers, Southwest Gas, and Icahn Investors, restricting sales or transfers of Centuri Common Stock without underwriter consent.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While the company itself did not receive proceeds from the share sales, which is neutral to slightly negative, the significant reduction in Southwest Gas's stake and the continued investment by Icahn Partners could be viewed positively by the market as it increases Centuri's independence and potentially its public float. The confirmation of compliance with various regulations also adds to a stable outlook.

Positives

• Continued investment by Icahn Partners LP and Icahn Partners Master Fund LP, indicating confidence from a significant investor.
• The public offering and private placement facilitate Southwest Gas Holdings, Inc.'s divestiture, potentially increasing Centuri's public float and liquidity over time.
• The shares are confirmed to be validly issued, fully paid, and nonassessable.
• Company confirms compliance with various regulations including Sarbanes-Oxley Act, Environmental Laws, Anti-Money Laundering Laws, and Sanctions.

Negatives

• Centuri Holdings, Inc. did not receive any proceeds from either the public offering or the concurrent private placement, meaning no direct capital infusion for the company.
• The private placement is contingent on HSR Act clearance, introducing a potential for delay or termination if not completed by July 9, 2025.
• A significant portion of the company's stock remains concentrated with Southwest Gas Holdings, Inc. (53.3% initially, 52.1% after private placement), which could limit liquidity or influence corporate control.

Risks

• The concurrent private placement with Icahn Investors is contingent upon the expiration or early termination of the applicable waiting period relating to the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
• If the private placement closing has not occurred by July 9, 2025, the Stock Purchase Agreement will terminate without the sale of shares to the Icahn Investors.
• General market conditions or unforeseen events could make it impracticable or inadvisable to proceed with the offering, sale, or delivery of shares.

Future Outlook

The concurrent private placement of 1,060,240 shares to Icahn Investors is expected to close on the first business day after the expiration or early termination of the Hart-Scott-Rodino Antitrust Improvements Act waiting period. The company has committed to registering the resale of these shares for Icahn Investors no later than 181 days after May 22, 2025, and will use reasonable best efforts to maintain the effectiveness of the Shelf Registration Statement.

Industry Context

This filing details a secondary public offering and a concurrent private placement, which are common mechanisms for large shareholders to divest portions of their holdings. The transactions are specific to Centuri Holdings, Inc. and its former parent, Southwest Gas Holdings, Inc., as part of a broader divestiture strategy. The involvement of Icahn Investors, a prominent activist investor, suggests continued strategic interest in Centuri.

Corporate Governance

Legal Proceedings

• The Company states that there are no legal, governmental or regulatory investigations, actions, demands, claims, suits, arbitrations, inquiries or proceedings pending or threatened that would reasonably be expected to have a Material Adverse Effect, except as described in the Registration Statement, Pricing Disclosure Package, and Prospectus.

Related Party Transactions

• Southwest Gas Holdings, Inc., the Selling Stockholder, is a significant shareholder of Centuri Holdings, Inc. The public offering and concurrent private placement involve the sale of Centuri shares by Southwest Gas Holdings, Inc. to the public and to Icahn Investors, who are also existing investors with prior agreements.

Stakeholder Impact

• Shareholders: Increased public float and potential liquidity for Centuri shares as Southwest Gas Holdings, Inc. reduces its stake. Existing shareholders might see a slight dilution of ownership percentage if they don't participate in the offering, but this is a secondary offering so no new shares are issued by Centuri.
• Icahn Investors: Increased ownership stake and granted registration rights, enhancing their ability to monetize their investment in the future.
• Southwest Gas Holdings, Inc.: Receives significant net proceeds (approximately $247 million total) from the sale of its Centuri shares, furthering its divestiture strategy.
• Company (Centuri Holdings, Inc.): No direct capital infusion from these transactions, but the reduction of a large controlling stake by Southwest Gas Holdings, Inc. could lead to greater independence and potentially a more diversified shareholder base over time.

Next Steps

• Closing of the Concurrent Private Placement to Icahn Investors, contingent on HSR Act clearance.
• Company to register the resale of shares for Icahn Investors no later than 181 days after May 22, 2025.
• Company to maintain effectiveness of the Shelf Registration Statement.

Key Dates

Recommendation

Keywords

Centuri Holdings, CTRI, Southwest Gas Holdings, Icahn Partners, Public Offering, Secondary Offering, Private Placement, Common Stock, SEC Filing, 8-K, Underwriting Agreement, Registration Rights, HSR Act, Lock-up Agreement, Equity, Investment