Tue | Nov 24, 2020

Bermuda power company to be sold to Canadian group

Published:Wednesday | June 5, 2019 | 12:19 AM

Ascendant Group, the parent company of Bermuda’s sole electricity provider, has accepted a takeover bid worth around US$365 million from a Canadian utility group.

Monday’s announcement of the intended sale to Algonquin Power & Utility Corporation marks the conclusion of a four-month evaluation of “strategic alternatives” by Ascendant, which owns the Bermuda Electric Light Company.

The deal signed by Ascendant is worth US$36 per share to shareholders, representing a premium of more than 63 per cent over last Friday’s closing price of US$22 on the Bermuda Stock Exchange. Shareholder and regulatory approval is needed before closure of the deal, which Ascendant expects to happen in the second half of this year.

“I note the announcement around the sale of Ascendant Group Limited today. There are considerable steps before this is finalised,” said Bermuda’s Home Affairs Minister, Walter Roban, whose responsibilities include the Department of Energy.

“I am confident that once an application is made to the Regulatory Authority, there will be a robust review to determine that Algonquin Power & Utilities Corporation has a strategy that is in line with this government’s commitment to drive down energy costs for the Bermuda public and ensure a more affordable and sustainable energy future for the island,” he said.

Back in March, Roban told the House of Assembly that the new owner would be expected to be “transparent, inclusive and collaborative”, and referred to labour disputes over the dismissal of several Bermudian staff last year.

Asked about other bidders considered by Ascendant, a spokesman for the company replied: “The process was very robust – and there was interest from many reputable international firms. We do not want to comment further for the sake of confidentiality.”

The common shares of Algonquin, which is based in Oakville, Ontario, are listed on both the Toronto Stock Exchange and the New York Stock Exchange.

The company has approximately US$10 billion worth of assets and operates natural gas and water utilities, as well as electricity companies.

CMC