Central Vermont Public Service terminates merger agreement with Canadian utility Fortis, will pay US$17.5M termination fee, plus US$2M in expenses to Fortis; CVPS agreed to be bought by Gaz Métro
ST. JOHN'S, Newfoundland and Labrador
July 12, 2011
– Fortis Inc. ("Fortis" or the "Corporation") (TSX:FTS) was informed yesterday that the Board of Directors of Central Vermont Public Service Corporation ("CVPS") (NYSE:CV) has determined that the unsolicited acquisition proposal from Gaz Métro Limited Partnership is a "Superior Proposal", as that term is defined in the Merger Agreement between Fortis and CVPS announced on May 30, 2011 (the "Merger Agreement") and that CVPS has elected to terminate the Merger Agreement in accordance with its terms. Prior to such termination taking effect, the Merger Agreement provided Fortis the right to require CVPS to negotiate with Fortis for at least five business days with respect to any changes to the terms of the Merger Agreement proposed by Fortis. Fortis agreed to waive such right in exchange for the prompt payment by CVPS to Fortis of the US$17.5 million termination fee plus US$2.0 million in expenses as set forth in the Merger Agreement, thereby resulting in the termination of the Merger Agreement. The Corporation expects to receive such payment today.
Fortis is the largest investor-owned distribution utility in Canada, with total assets of approximately $13 billion and fiscal 2010 revenue totalling approximately $3.7 billion. The Corporation serves more than 2,000,000 gas and electricity customers. Its regulated holdings include electric distribution utilities in five Canadian provinces and two Caribbean countries and a natural gas utility in British Columbia, Canada. Fortis owns and operates non-regulated generation assets across Canada and in Belize and Upper New York State. It also owns hotels and commercial office and retail space primarily in Atlantic Canada. Fortis shares are listed on the Toronto Stock Exchange and trade under the symbol FTS. Additional information can be accessed at www.fortisinc.com or www.sedar.com.