Hydro One Limited and Avista Corporation have mutually agreed to terminate their previously announced merger agreement. This decision follows recent orders by the Washington Utilities and Transportation Commission and Idaho Public Utilities Commission, which denied approval of the merger.
According to a press release, after careful consideration and analysis of the likelihood of achieving a timely reversal of those orders, the boards of directors of Hydro One and Avista individually determined that termination of the merger agreement is the best course of action for the companies and their respective shareholders.
Scott L. Morris, Chairman of the Board and CEO of Avista, said, “While disappointed with the outcome, I want to express our deepest gratitude to everyone who worked with us on this effort over the past 18 months,” said Scott L. Morris, chairman of the board and chief executive officer of Avista. “Avista is a strong, vibrant, and independent utility, and we look forward to building on our legacy of nearly 130 years by continuing to serve the best interests of our most important stakeholders – our valued customers, loyal employees, the communities we serve, and our shareholders.”
“Hydro One’s Board, management and employees remain focused on delivering safe and reliable power, providing exceptional customer service and driving shareholder value. On behalf of Hydro One, I would like to thank the teams who have worked tirelessly on the proposed merger throughout this process,” said Paul Dobson, acting president and CEO of Hydro One.
As required by the merger agreement, Hydro One will pay Avista a US$103 million termination fee.
The merger originally was announced in July 2017, with Hydro One acquiring Avista for US$5.3 billion in an all-cash transaction.
Hydro One is an electricity transmission and distribution provider in Ontario, Canada, with more than 1.3 million customers, over C$25 billion in assets and 2017 annual revenues of nearly C$6 billion.
Avista is an energy company involved in the production, transmission and distribution of energy as well as other energy-related businesses. Avista Utilities is the operating division that provides electric service to 383,000 customers and natural gas to 348,000 customers in eastern Washington, northern Idaho and parts of southern and eastern Oregon. Avista operates 13 hydroelectric projects in four states with a total capacity of 1,114 MW.