• Email Us: [email protected]
  • Contact Us: +1 718 874 1545
  • Skip to main content
  • Skip to primary sidebar

Medical Market Report

  • Home
  • All Reports
  • About Us
  • Contact Us

Canada’s Hydro One seeks bigger M&A targets to boost customers

October 5, 2021 by David Barret Leave a Comment

October 5, 2021

By Maiya Keidan and Shariq Khan

(Reuters) – Ontario’s largest electric utility, Hydro One Ltd, is seeking acquisitions worth up to C$500 million ($397 million) to boost its customer base and consolidate the fragmented industry, a spokeswoman told Reuters.

The government of Ontario, Canada’s most populous province, is eager to bring down electricity costs for customers. To achieve that, the province is encouraging Hydro One to obtain customers through acquisition, according to sources.

“We believe this consolidation of our business benefits the community, Ontario and Hydro One as it makes the provincial grid more efficient, while reducing costs across the system,” the Hydro One spokeswoman said.

Dealmaking will mainly focus on expanding service areas and customers, replacing aging infrastructure and improving grid reliability, said one of the sources.

Ontario’s electricity distribution network is highly fragmented with 60 companies, 55 of which hold less than a 2% share of the industry, according to data from provincial regulator the Ontario Energy Board (OEB).

Hydro One, which has a market value of C$17.9 billion, declined to say how much it plans to increase its customer base from the current 1.4 million.

While the company has by far the largest market share in the province, with 35.5% of the industry total, Toronto Hydro-Electric System Ltd and Alectra Utilities Corp are top competitors, with 21.8% and 18.1% of the market, respectively.

LOWER BILLS

Two of Hydro One’s smaller deals, worth a total C$132 million, won regulatory approval last year, encouraging the company to hunt for more opportunities.

“I think government over time has been trying to encourage consolidation,” said Gavin MacFarlane, vice president-senior credit officer at Moody’s.

The company, which had over C$2 billion in net cash as of December 31, 2020, according to its last annual report, plans to fund acquisitions using its balance sheet, said the spokeswoman.

Hydro One last month estimated spending of C$1.91 billion on capital investment for 2021, but the spokeswoman declined to comment on how much would be spent on mergers and acquisitions.

Dealmaking in Canadian power companies has accounted for $2.3 billion this year to date compared with $4.3 billion for the entirety of 2020, with Hydro One making up 2% of deals, according to data from Dealogic.

Hydro One most recently acquired the business assets of Peterborough Distribution Inc and Orillia Power Distribution Corp for a total value of C$104 million.

Hydro One told Reuters that customers in Peterborough and Orillia saw a 1% reduction in the base distribution part of their bills after the acquisitions.

“We believe there are further opportunities in Ontario for consolidation and we are open to pursuing these opportunities as they arise,” said the spokeswoman.

Hydro One, 47.3% owned by the government of Ontario, has been beefing up its mergers and acquisitions team by hiring experts from banks and other advisory firms, three sources told Reuters and the company confirmed.

Among Hydro One’s recent hires was new Vice President, Growth Matt Vines, an investment banker hired from Bank of Montreal in August who previously worked in M&A for Canadian Imperial Bank of Commerce.

While the spokeswoman for Hydro One said the company was “strengthening” its corporate strategy team, she declined to share the size of the current team with Reuters.

($1 = 1.2635 Canadian dollars)

(Reporting by Maiya Keidan in Toronto and Shariq Khan in Bengaluru; Editing by Denny Thomas and Steve Orlofsky)

Source Link Canada’s Hydro One seeks bigger M&A targets to boost customers

David Barret
David Barret

Related posts:

  1. U.S. Gulf Coast grain exports remain crippled by Ida as harvest nears
  2. IMF warns of ‘looming humanitarian crisis’ in Afghanistan
  3. Confluent CEO Jay Kreps is coming to TC Sessions: SaaS for a fireside chat
  4. U.S. concerned with China’s rising military activity near Taiwan

Filed Under: News

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

  • Martian Mudstone Has Features That Might Be Biosignatures, New Brain Implant Can Decode Your Internal Monologue, And Much More This Week
  • Crocodiles Weren’t All Blood-Thirsty Killers, Some Evolved To Be Plant-Eating Vegetarians
  • Stratospheric Warming Event May Be Unfolding In The Southern Polar Vortex, Shaking Up Global Weather Systems
  • 15 Years Ago, Bees In Brooklyn Appeared Red After Snacking Where They Shouldn’t
  • Carnian Pluvial Event: It Rained For 2 Million Years — And It Changed Planet Earth Forever
  • There’s Volcanic Unrest At The Campi Flegrei Caldera – Here’s What We Know
  • The “Rumpelstiltskin Effect”: When Just Getting A Diagnosis Is Enough To Start The Healing
  • In 1962, A Boy Found A Radioactive Capsule And Brought It Inside His House — With Tragic Results
  • This Cute Creature Has One Of The Largest Genomes Of Any Mammal, With 114 Chromosomes
  • Little Air And Dramatic Evolutionary Changes Await Future Humans On Mars
  • “Black Hole Stars” Might Solve Unexplained JWST Discovery
  • Pretty In Purple: Why Do Some Otters Have Purple Teeth And Bones? It’s All Down To Their Spiky Diets
  • The World’s Largest Carnivoran Is A 3,600-Kilogram Giant That Weighs More Than Your Car
  • Devastating “Rogue Waves” Finally Have An Explanation
  • Meet The “Masked Seducer”, A Unique Bat With A Never-Before-Seen Courtship Display
  • Alaska’s Salmon River Is Turning Orange – And It’s A Stark Warning
  • Meet The Heaviest Jelly In The Seas, Weighing Over Twice As Much As A Grand Piano
  • For The First Time, We’ve Found Evidence Climate Change Is Attracting Invasive Species To Canadian Arctic
  • What Are Microfiber Cloths, And How Do They Clean So Well?
  • Stowaway Rat That Hopped On A Flight From Miami Was A “Wake-Up Call” For Global Health
  • Business
  • Health
  • News
  • Science
  • Technology
  • +1 718 874 1545
  • +91 78878 22626
  • [email protected]
Office Address
Prudour Pvt. Ltd. 420 Lexington Avenue Suite 300 New York City, NY 10170.

Powered by Prudour Network

Copyrights © 2025 · Medical Market Report. All Rights Reserved.

Go to mobile version