- Ontario’s largest electricity provider, Hydro One (TSX:H) has received approval for its acquisitions of Orillia Power Distribution Corporation and Peterborough Distribution Inc.
- Hydro One will wholly acquire Orillia Power for C$26.35 million, and will assume approximately $14.9 million in debt and regulatory liabilities
- Meanwhile, Peterborough’s business and distribution assets will be acquired for $105 million
- Both deals were approved by The Ontario Energy Board are expected to close in the coming months
- Hydro One (H) is currently down 1.62 per cent to $24.83 per share, with a market cap of $14.83 billion
Hydro One (TSX:H) has received approval for its acquisitions of Orillia Power Distribution Corporation and Peterborough Distribution Inc.
The company is Ontario’s largest electricity transmission and distribution provider, servicing approximately 1.4 million customers. Approval for the deals was granted by the Ontario Energy Board, which regulates natural gas and electricity utilities in the province.
Hydro One initially announced its intentions to acquire Orillia Power Distribution back in August 2016.
Under the terms of the agreement, Hydro One will acquire the company in its entirety for C$26.35 million, assuming approximately $14.9 million in debt and regulatory liabilities for a total transaction value of $41.3 million.
Orillia Power Distribution currently serves roughly 14,000 customers in central Ontario.
Upon closing the deal, Hydro One expects to make additional investments in the surrounding Orillia community, including the development of a new provincial warehouse and regional operations centre.
Peterborough Distribution’s business and distribution assets will be acquired for a total purchase price of $105 million. The company currently serves roughly 37,000 customers in the City of Peterborough and the Villages of Lakefield and Norwood.
Like the deal with Orillia Power Distribution, Hydro One also plans to make several investments in the surrounding communities. This is expected to include the development of a new operations centre and fleet maintenance facility.
Customers associated with the two acquisitions will have their base distribution charges cut by 1 per cent and frozen for a period of five year. This will be followed by incremental increases at, or near, inflation rates from years six to ten.
Both deals are expected to close within the next few months.
Mark Poweska, President and CEO of Hydro One, said he is looking forward to welcoming the new customers and employees to the Hydro One family.
“These strong partnerships will energize life in the City of Orillia and the City of Peterborough for years to come through our continued investment in exceptional customer service, safe and efficient operations, and community initiatives.
“We would like to thank Mayor Clarke and Mayor Therrien, Orillia and Peterborough City Councils, and the OPDC and PDI teams for their dedication and partnership,” he said.
Hydro One (H) is currently down 1.62 per cent to $24.83 per share at 2:04pm EDT.