Avista, Hydro One abandon plans for sale
SPOKANE, Wash. (AP) — The Spokane, Washington-based Avista Corp. and Hydro One Ltd. have abandoned plans for the Canadian utility to buy Avista.
The Spokesman-Review reports the two companies announced the termination of the proposed $5.3 billion deal Wednesday afternoon. Hydro One’s financing for the sale expires in April and the companies were facing a March 29 deadline to complete the transaction.
Both companies concluded it would be difficult to overturn the earlier denial of the sale by Washington and Idaho regulators in time to meet the deadline.
As required by the sales agreement, Hydro One, based in Toronto, will pay Avista a $103 million termination fee. Avista will use the money to offset expenses from the proposed sale and for other company purposes.
“This one didn’t work out,” said Scott Morris, Avista’s chairman and chief executive. ”(Avista) stays an independent company.”
Morris announced the proposed sale at a news conference in July 2017, introducing Hydro One as a partner with corporate values similar to Avista’s. But the province of Ontario’s 47 percent ownership stake in the Toronto-based utility quickly became a target for opponents of the sale.
After newly elected Ontario Premier Doug Ford fired Hydro One’s board of directors in July and asked for the CEO’s retirement, state regulators’ review of the sale shifted to how much control the province exerted over Hydro One. Ford said he was fulfilling a campaign promise.
“I did not foresee the political upheaval, and it changed the tenor of the deal,” Morris said.
Avista Customer Group, made up of utility customers opposed to the sale, had argued that a foreign government’s influence over Hydro One made the company a poor choice to acquire Avista.
“Us attempting to show that was trumped by it actually happening,” said Norman Semanko, attorney for Avista Customer Group. “I wish Avista nothing but the best, but this Hydro One wasn’t the best fit.”
Public utilities commissions in Washington and Idaho referenced the politically motivated firings at Hydro One during hearings. The Washington Utilities and Transportation Commission denied approval of the sale in December, saying it wasn’t in the best interest of Avista or its customers.
The Idaho Public Utilities Commission denied approval earlier this month, saying the sale would violate state law.