Newfoundland’s Fortis Gets Bigger
ST JOHN’S–Newfoundland and Labrador-based Fortis today announced a $6.9-billion (U.S.) cash-and-stock deal to buy transmission-line owner ITC Holdings Corp.
ITC is a major independent electric transmission company. It owns and operates about 25,000 kilometres of high-voltage lines in Michigan, Iowa, Minnesota, Illinois, Missouri, Kansas and Oklahoma.
With the deal, Fortis says it will become one of the top 15 North American public utilities on an enterprise-value basis.
“Fortis has grown its business through strategic acquisitions that have contributed to strong organic growth over the past decade,” said Fortis president and chief executive officer Barry Perry.
“The acquisition of ITC – a premium pure-play transmission utility – is a continuation of this growth strategy. ITC not only further strengthens and diversifies our business, and it also accelerates our growth.”
Fortis will pay the equivalent of $44.90 for each ITC share, in the form of $22.57 in cash and 0.752 Fortis shares, a premium of 14 per cent to ITC’s closing stock price on Monday. It will also assume ITC’s debt of about $4.4-billion.
Fortis’s regulated utilities have more than three million customers. Fortis is the majority owner of Newfoundland Power, and its other holdings include utilities in Prince Edward Island and British Columbia as well as a gas and electricity company in New York state, an electric utility in Vermont and utilities in the Caribbean.