Hydro One Limited announced today that its wholly-owned subsidiary Hydro One Inc. has entered into a purchase agreement to acquire from Brookfield Infrastructure various entities that own and control Great Lakes Power Transmission LP (“Great Lakes Transmission”), an Ontario regulated electricity transmission business operating along the eastern shore of Lake Superior, north and east of Sault Ste. Marie, Ontario, for $222 million in cash, subject to customary adjustments, plus the assumption of approximately $151 million in outstanding indebtedness.
The Great Lakes Transmission business has a rate base of approximately $219 million, and it consists of 15 transmission stations, 560 kilometers of high and medium voltage 44-230 kV transmission lines, and related infrastructure covering an area of 12,000 square kilometers and connects to Hydro One’s Wawa and Mississagi transmission stations. Upon completion of the transaction, Hydro One will operate approximately 98% of Ontario’s transmission capacity.
“Following Hydro One’s successful IPO and the recent acquisition of three Local Distribution Companies, this transaction is further testament to the people and potential of Hydro One”, said Mayo Schmidt, President and CEO, Hydro One Limited. “Our intense focus on customers and communities together with our disciplined approach to leveraging strategic opportunities is an important combination as we move forward with the transformation of this company.”
The transaction is conditional upon the satisfaction of customary closing conditions, including receipt of Competition Act (Canada) approval and approval of the Ontario Energy Board.
National Bank Financial Markets acted as financial advisor and Osler, Hoskin & Harcourt LLP acted as legal counsel to Hydro One in connection with the transaction.