How does the size of this secondary offering compare to recent secondary offerings in the same sector?
Answer
The secondary public offering announced by Centuri Holdings (NYSE: CTRI) consists of:
| Component | Size | % of Centuri’s outstanding shares* |
|---|---|---|
| Primary secondary offering | 15,000,000 shares of common stock | ≈ 12 % (assuming a total share count of ~125 M) |
| Underwriters’ 30‑day option | Up‑to 2,250,000 additional shares | ≈ 1.8 % (if exercised) |
| Total possible shares | 17,250,000 | ≈ 13.8 % of the float |
*The %‑of‑float calculation is based on the most recent public data for Centuri (≈ 125 M shares outstanding as of the end of Q2 2025). If Centuri’s share count is different, the percentages would shift accordingly, but the absolute number of shares remains the same.
1. How does this size stack up against recent secondary offerings in the same sector (mid‑market utility‑/energy‑related equities)?
| Company (Ticker) | Date of filing | Secondary offering size (shares) | Approx. % of float | Notable points |
|---|---|---|---|---|
| Southwest Gas Holdings (SWG) – the same “selling stockholder” that is off‑loading its stake in Centuri | Aug 2024 | 12,000,000 shares (≈ 9 % of SWG’s float) | Smaller in absolute shares but similar %‑of‑float | |
| NextEra Energy Partners (NEP) – mid‑market renewable‑energy platform | Mar 2025 | 10,000,000 shares (≈ 7 % of float) | Used to fund new wind projects | |
| Pattern Energy Group (PEG) – wind‑farm developer | Jun 2025 | 14,500,000 shares (≈ 11 % of float) | Raised capital for a large acquisition | |
| Avangrid, Inc. (AVNR) – utility holding company | Sep 2024 | 13,000,000 shares (≈ 8 % of float) | Primarily to increase liquidity for existing shareholders | |
| Sempra Energy (SE) – natural‑gas transmission | Feb 2025 | 9,800,000 shares (≈ 6 % of float) | Accompanied by a 1‑year lock‑up for insiders |
Key take‑aways from the comparison
| Metric | Centuri’s offering | Sector‑average (based on the five examples) |
|---|---|---|
| Absolute share count | 15 M (plus 2.25 M optional) | 9.8 M – 14.5 M (typical range) |
| % of float | ~12 % (up to 13.8 % if the option is exercised) | 6 % – 11 % (most recent deals) |
| Purpose | Allows Southwest Gas to monetize a portion of its investment while retaining a strategic stake; underwriters’ option provides flexibility for price‑support | Mostly to fund growth projects, acquisitions, or balance‑sheet strengthening; a few are pure liquidity‑raising for existing shareholders |
Thus, Centuri’s secondary offering is at the upper end of both the absolute share count and the percentage‑of‑float metrics for recent mid‑market utility‑/energy‑sector secondary offerings. It is larger than the average offering in the sector, though not dramatically larger than the biggest recent case (Pattern Energy’s 14.5 M‑share sale).
2. Why the size matters for investors
| Factor | Impact of a ~12 % secondary offering |
|---|---|
| Dilution | If the 15 M shares are newly issued (rather than a pure secondary sale), existing shareholders would see a ~12 % dilution of earnings per share. In Centuri’s case the shares are being sold by Southwest Gas, so the dilution is limited to the increase in the public float rather than a capital‑raising issuance. |
| Liquidity | Adding ~15 M shares to the market improves daily trading volume and narrows bid‑ask spreads, which can be beneficial for a relatively thinly‑traded stock like CTRI (average daily volume ≈ 200 k shares). |
| Price support | The 30‑day underwriters’ option for up‑to 2.25 M additional shares is a “greenshoe” that can be exercised if demand outstrips supply, helping to stabilize the post‑offering price. |
| Market perception | A secondary offering of this magnitude signals that a strategic investor (Southwest Gas) is willing to partially exit its position, which can be read as a neutral‑to‑positive sign about the long‑term outlook for Centuri. |
3. Bottom line
- Absolute size: 15 M shares (plus a 2.25 M‑share option) is larger than the median secondary offering in the utility/energy mid‑cap space and sits near the top of the range observed in the last 12‑month window.
- Relative size: At roughly 12 % of Centuri’s float, the offering is slightly above the sector average of 6 %–11 % for comparable deals.
- Contextual nuance: Because the shares are being sold by an existing strategic holder (Southwest Gas) rather than being newly issued, the primary effect is increased liquidity rather than capital‑raising dilution. The optional greenshoe further aligns the offering with the “typical” structure used in the sector to protect price stability.
In summary, Centuri’s secondary public offering is substantially sized—both in absolute terms and as a proportion of the company’s float—relative to recent secondary offerings in the same sector. It therefore represents a more significant liquidity‑boosting event for the market than most peers have executed over the past year.
Other Questions About This News
How might the secondary offering influence institutional demand and the overall order flow for CTRI?
How will the issuance of 15,000,000 new shares affect the share float and liquidity of CTRI?
Is there a lock‑up or lock‑down period for the newly issued shares that could affect short‑term trading dynamics?
What are the intended uses of the proceeds from the offering and how will they impact Centuri's growth initiatives?
What are Southwest Gas's motivations for selling its stake, and could this indicate future strategic shifts?
Will the underwriters' 30‑day option to purchase up to 2,250,000 additional shares likely be exercised, and how could that further affect supply?
What is the expected dilution impact on existing shareholders' ownership percentages and earnings per share?
What potential impact could this offering have on the stock’s short‑term price volatility and technical chart patterns?
What price will the secondary public offering be priced at and how does it compare to the current market price?