American electrical and gas utility company Avista Corp. (NYSE: AVA) is subject to a $5.32 billion bid from Canadian Hydro One Ltd. (TSE:H).
The massive bid valued the company at $53 per share, a 22.3% increase on the company’s Wednesday close. Since then, shares have risen to $51.93 amid high expectations for a successful takeover. The deal is not yet solidified however as multiple state regulators, stock holders and even federal government officials must sign off on the sale, as the company currently supplies its services to multiple states, and the effect of this sale must be evaluated first.
The Washington Utilities and Transportation Commission says the utilities have not yet filed for approval, but they will have to prove a benefit to customers before this deal can go down. The companies will have $25.4 billion in combined assets, creating one of the largest regulated utilities in North America, and will serve over 2 million people spread across Ontario, plus U.S. states like Washington, Oregon, Idaho, Montana as well as Alaska. Avista will also maintain its headquarters, board of directors and management team, and is intended to operate as a stand-alone utility.
An overall win for Avista, this will see them be able to throw more financial might into their pursuits, while maintaining the business core.