US utility NextEra Energy to buy Hawaiian Electric Industries for $2.63 bn
04 December 2014
US utility NextEra Energy Inc yesterday struck a deal to buy Hawaii's largest power supplier Hawaiian Electric Industries Inc, for about $2.63 billion in cash and stock.
NextEra, one of the largest rate-regulated electric utilities in the US, will also assume $1.7 billion of Hawaiian Electric's debt, taking the total deal value to about $4.3 billion
Under the financial terms of the deal, NextEra will give 0.2413 of its shares for each Hawaiian Electric share, amounting to about $25.19 per share, based on the stock's Wednesday closing price.
The company will also pay a one-time cash dividend of 50 cents per share, and Next Era expects the deal to close in 12 months.
Hawaiian Electric is the largest supplier of electricity in the state of Hawaii, supplying power to nearly 95 per cent of Hawaii's population. It operates 3 utilities on 5 separate grids.
The Honolulu-based company also owns one of Hawaii's largest savings and loan holding companies with a subsidiary which performs savings bank operations, mortgage banking, credit card services and other related financial, American Savings Bank (ASB).
The proposed acquisition does not include ASB, which will be spun off prior to the deal closing to Hawaiian Electric shareholders as an independent publicly traded company.
NextEra Energy is one of the largest energy suppliers in North America, and the largest generator in North America of renewable energy from the wind and sun.
It is currently the largest owner and operator of wind turbines in the US, and accounts for about 25 per cent US wind power installed. It has approximately 42,500 megawatts of generating capacity and employs around 13,900 people.
The Florida-based company has a market cap of $45.6 billion and annual revenues of $15.1 billion.