Iberdrola USA and UIL Holdings merge businesses in the U.S.

Subscribe to our newsletter and get the latest news and business opportunities in your inbox
Iberdrola USA and UIL Holdings merge businesses in the U.S.

Iberdrola USA, a wholly owned subsidiary of Iberdrola S.A., and UIL Holdings, a diversified energy delivery company, have agreed to merge businesses in the U.S.

The boards of directors of Iberdrola S.A. and Iberdrola USA have approved the transaction.

This friendly transaction, recommended by UIL’s board of directors, which will be effected via merger, will allow UIL shareholders to receive 18.5% of the share capital of the combined company plus US$597 million in cash, representing a premium of 19.5% over the average UIL share price during the 30 days prior to February 25.

The combination of Iberdrola USA and UIL Holdings, with over 3.1 million of points of supply, approximately 6.7 GW of installed capacity, and pro-forma Ebitda and net earnings of US$2 billion and US$570 million in 2014, respectively, will create a leading utility in the US.

The agreement between Iberdrola USA and UIL Holdings, is subject to approval by UIL Holdings shareholders. As UIL Holdings and its subsidiaries operate in a regulated sector, the relevant authorizations at state level and Federal level will be required. This process is expected to be completed during 2015.

Ignacio Galán, chairman of Iberdrola, stated:

“the operation that integrates Iberdrola USA and UIL is consistent with our strategy of growth in this country, a key market in which we are taking a major step forward. It also reflects our preference for effecting corporate operations on a friendly basis.”

Iberdrola USA has utility operations in the states of New York and Maine, and is the second largest wind energy producer with a presence in 23 States. In 2014 Iberdrola USA had approximately 1.8 million electricity and 0.6 million gas points of supply. The company distributed a total of 33,335 gigawatt hours (GWh) of electricity and supplied 40,870 gigawatt hours (GWh) of gas and has an installed capacity of 6.5 gigawatts (GW). Iberdrola USA had in 2014 an EBITDA of $1,576 million, and net income of $446 million.

Iberdrola, through its engineering subsidiary, has recently been awarded the construction of a 674 MW combined cycle power plant (CCGT) in Salem, Massachusetts, USA. The project, located some 30 kilometres from Boston, was awarded by Footprint Power.

UIL Holdings is a public utility holding company organized under the laws of the State of Connecticut and its shares trade on the New York Stock Exchange. The company distributed in 2013 a total of 5,422 gigawatt hours (GWh) of electricity and 77,638 MM of gas cubic feet (bcf). It had 1,895 employees at the end of 2014.

Share this news