Hydro One and Avista receive regulatory approval of acquisition, concluding merger proceeding in Alaska
TORONTO and SPOKANE, WA, June 4, 2018 – Hydro One Limited (“Hydro One”) (TSX: H) and Avista Corporation (“Avista”) (NYSE: AVA) today announced that the companies have received approval from the Regulatory Commission of Alaska (“RCA”) of their proposed merger subject to the following conditions: (1) Alaska Electric Light & Power Company’s (“AEL&P”) capital structure is maintained at its previously ordered debt and equity levels, (2) there will be no rate recovery of transaction costs or premium associated with the acquisition, (3) assignment of costs related to services between Avista and AEL&P will be subject to review and approval by the RCA, (4) AEL&P continues to be operated independently with the same experienced management team as existed prior to the acquisition, and (5) the parties adhere to all commitments filed with the RCA on April 3, 2018.
With this order, the merger has received all required approvals in Alaska.
“We are very pleased to receive this approval from the Regulatory Commission of Alaska to bring together two historic companies,” said Mayo Schmidt, President and CEO, Hydro One. “I would like to thank the City and Borough of Juneau and the Regulatory Commission of Alaska for the thoughtful decision. We look forward to partnering with Avista and Alaska Electric Light & Power as they continue to serve your community.”
“We are pleased with the RCA’s decision and recognize this as a major milestone and positive outcome in the process to formalize the partnership between Avista and Hydro One,” Avista Chairman and Chief Executive Officer Scott L. Morris said. “The RCA’s decision affirms the commitments we’ve made to the residents of Juneau, who can expect their utility to continue to operate as it does today. This approval brings us one step closer to realizing the benefits of the transaction for our customers, communities, employees and shareholders. We look forward to continuing to work with the utility commissions in our other jurisdictions and expect the transaction to close in the second half of 2018.”
Applications for regulatory approval of the transaction are still pending with utility commissions in Washington, Idaho, Oregon and Montana. An all-parties, all-issues settlement agreement was filed with the Washington Utilities and Transportation Commission on March 27, 2018. An all-parties, all-issues settlement agreement was filed with the Idaho Public Utilities Commission on April 13, 2018. An all-parties, all-issues settlement agreement was filed with the Public Utility Commission of Oregon on May 25, 2018. A settlement agreement with the City of Colstrip was filed with the Montana Public Service Commission on May 15, 2018.
Hydro One and Avista received the Federal Communications Commission’s consent on May 4, 2018 to close their merger and antitrust clearance on April 5, 2018 after the expiration of the waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The transaction received approval from the Federal Energy Regulatory Commission on January 16, 2018 and from Avista shareholders on November 21, 2017. The Committee on Foreign Investment in the United States completed its review of the proposed merger on May 18, 2018, and has concluded that there are no unresolved national security concerns with respect to the transaction. Also required is the satisfaction of other customary closing conditions.
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About Hydro One Limited
We are Ontario's largest electricity transmission and distribution provider with more than 1.3 million valued customers, over C$25 billion in assets and 2017 annual revenues of nearly C$6 billion. Our team of over 7,400 skilled and dedicated regular and non-regular employees proudly and safely serves suburban, rural and remote communities across Ontario through our 30,000 circuit km of high-voltage transmission and 123,000 circuit km of primary distribution networks. Hydro One is committed to the communities we serve, and has been rated as the top utility in Canada for its corporate citizenship, sustainability, and diversity initiatives. We are one of only five utility companies in Canada to achieve the Sustainable Electricity Company designation from the Canadian Electricity Association. We also provide advanced broadband telecommunications services on a wholesale basis utilizing our extensive fibre optic network through Hydro One Telecom Inc. Hydro One Limited's common shares are listed on the Toronto Stock Exchange (TSX: H).
Forward-Looking Statements and Information
This press release and all documents to which it refers may contain “forward-looking information” within the meaning of applicable securities laws. Words such as “expect,” “anticipate,” “intend,” “attempt,” “may,” “plan,” “will”, “can”, “believe,” “seek,” “estimate,” and variations of such words and similar expressions are intended to identify such forward-looking information. These statements are not guarantees of future performance or actions and involve assumptions and risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed, implied or forecasted in such forward-looking information. Some of the factors that could cause actual results or outcomes to differ materially from the results expressed, implied or forecasted by such forward-looking information, including some of the assumptions used in making such statements, are discussed more fully in Hydro One’s filings with the securities regulatory authorities in Canada, which are available on SEDAR at www.sedar.com. Hydro One does not intend, and it disclaims any obligation, to update any forward-looking information, except as required by law.
About Avista Corporation
Avista Corporation is an energy company involved in the production, transmission and distribution of energy as well as other energy-related businesses. Avista Utilities is our operating division that provides electric service to 385,000 customers and natural gas to 350,000 customers. Its service territory covers 30,000 square miles in eastern Washington, northern Idaho and parts of southern and eastern Oregon, with a population of 1.6 million. Alaska Energy and Resources Company is an Avista subsidiary that provides retail electric service in the city and borough of Juneau, Alaska, through its subsidiary Alaska Electric Light & Power Company. Avista stock is traded under the ticker symbol "AVA." For more information about Avista, please visit www.myAvista.com.
This news release contains forward-looking statements regarding the company’s current expectations. Forward-looking statements are all statements other than historical facts. Such statements speak only as of the date of the news release and are subject to a variety of risks and uncertainties, many of which are beyond the company’s control, which could cause actual results to differ materially from the expectations. These risks and uncertainties include, in addition to those discussed herein, all of the factors discussed in the company’s Annual Report on Form 10-K for the year ended Dec. 31, 2017 and the Quarterly Report on Form 10-Q for the quarter ended March 31, 2018.