Dive Brief:
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The Missouri Public Service Commission (PSC) has approved Fortis’ acquisition of ITC, an independent transmission company based in Novi, Michigan.
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ITC owns and operates transmission lines in Michigan, Iowa, Minnesota, Illinois, Missouri, Kansas and Oklahoma, that serve a combined peak load of more than 26,000 MW on about 15,700 circuit miles of transmission lines.
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The deal, valued at $11.3 billion, has received regulatory approvals from Illinois and Oklahoma and must still be ratified by other state regulators and by the Federal Energy Regulatory Commission; the deal is expected to close by year end.
Dive Insight:
Fortis has been active in the U.S. power market, buying mostly regulated assets or utilities with stable revenues.
The Canadian company is the parent company of UNS Energy, which owns Tucson Electric Power in Arizona. Fortis also owns Central Hudson Gas & Electric in New York, as well as regulated utilities in Canada and the Caribbean Basin.
ITC would be Fortis’ first pure play transmission asset in the U.S., and like past acquisitions would add to Fortis’ stable of regulated assets with relatively stable revenues.
The deal will be transformative for Fortis, making U.S. assets account for 62% of the company’s revenues. Fortis plans to sell $2 billion in bonds and to offer shares on the New York and Toronto exchanges to finance the acquisition.
