Hydro One Ltd. (TSX:H) has whistled a friendly deal to acquire U.S. energy company Avista Corp. for C$6.7 billion in an all-cash see to that would create one of the largest regulated utilities in North America.
The Toronto-based party said Wednesday after the close of markets that it will pay C$67 per allowance in cash for the U.S. firm. Shares in Avista closed Wednesday at US$43.33 on the New York Estimate Exchange.
«This is really a proud moment for Canadians as we grow our company to become a North American leader,» said Hydro One CEO Mayo Schmidt during a hustle conference, adding Hydro One will be a more valuable company because of the goings-on.
«This merger agreement allows for more robust expansion into new dig ups of business and into new jurisdictions, including the Pacific Northwest, which is circumstancing customer growth,» he said.
The companies said there will be no job passings as a result of the merger and customer rates will not be affected by any of the costs associated with the goings-on.
«Together we can and will create a stronger, more innovative, more fellow focused energy leader,» Schmidt said.
Under the agreement, Avista wish keep its existing corporate headquarters in Spokane, Wash., and continue to act as a stand-alone utility in Washington, Oregon, Idaho, Montana and Alaska.
«As we reckon our strategy going forward and the transformational changes happening in our industry, it was of the utmost prominence for us to control our own destiny,» said Scott Morris, Avista chairman and CEO, during the symposium.
The partnership largely allows Avista to preserve how it does business with its patrons, enables it to continue to pursue technological innovation, and permits it to take improvement of operating efficiencies and shared best practices, he said.
The company is disturbed to partner with Hydro One and is well-positioned for the future, said Morris.
Administer approved unanimously
The deal was unanimously approved by the boards of both companies and is expected to draw in the second half of 2018, subject to Avista shareholder and certain regulatory and oversight approvals.
In November 2015, Hydro One went public with much hullabaloo, raising $1.83 billion in one of the biggest and most politically charged primary public offerings in Canada. The partial sale of the utility was part of the Ontario domination’s plan to raise money to fund transit and infrastructure projects.
As the fix largest shareholder in Hydro One, the provincial government stands to benefit from the obtaining, which is poised to reap returns beginning in 2019, provincial Vigour Minister Glenn Thibeault said.
«It is expected to deliver clear service perquisites for the company’s customers, employees and shareholders — including the people of Ontario,» Thibeault conveyed in a statement.
Hydro One has more than 1.3 million customers, $25 billion in assets and retains 5,500 people. Avista provides electric and natural gas services to 721,000 chaps.