Vermont Public Service Board
Approves Acquisition of Green Mountain Power by Gaz Métro
March 27, 2007
Gaz Métro Limited
Partnership (TSX: GZM.UN), through its wholly owned subsidiary,
Northern New England Energy Corporation (NNEEC), has taken the
last regulatory step in the process to acquire Green Mountain
Power Corporation (NYSE: GMP), the second-largest electricity
distributor in Vermont. The Vermont Public Service Board
approved the agreement and the plan to merge GMP with a wholly
owned subsidiary of NNEEC. That subsidiary includes, among
others, Gaz Métro’s activities in Vermont. The transaction is
expected to close in the coming weeks.
“We are very pleased with the decision
of the Vermont Public Service Board and we hope to soon complete the transaction
begun in June 2006,” said Sophie Brochu, President and Chief Executive Officer
of Gaz Métro.
Gaz Métro, through its wholly owned
subsidiary NNEEC, in June 2006 signed an offer to purchase GMP for a cash
consideration of $35 a share, for a total purchase price of approximately $187
In its decision, the Vermont Public
Service Board noted that Gaz Métro’s 20-year presence in Vermont through Vermont
Gas Systems is a guarantee of its long-term commitment to energy consumers in
“Green Mountain Power is known for its
responsible management, its commitment to energy efficiency and its promotion of
energy solutions that respect the environment. These characteristics closely
match the culture, values and initiatives adopted by Gaz Métro, which positively
influenced our decision to acquire the company. We believe that this transaction
offers the potential to strengthen those orientations within both our
companies,” added Brochu.
Power at a glance
Green Mountain Power is a public
service utility whose revenues approach $250 million US. GMP is the
second-largest electricity distributor in Vermont, with 195 employees working to
serve more than 90,000 customers. It transmits, distributes and sells
electricity, as well as offering construction services for electrical grids in
the State of Vermont. Once the transaction is closed, Green Mountain Power will
continue to be managed by the current team based in Vermont.
Métro at a glance
With more than $2.7 billion of assets
and over 1,500 employees in Québec, Gaz Métro is a leading Québec energy company
and one of the largest natural gas distributors in Canada. It serves some
167,000 customers in Québec through its approximately 10,000 km underground
system, while a subsidiary, Vermont Gas Systems, serves some 38,000 customers.
COLCHESTER, VT.--(BUSINESS WIRE)--June 22,
Green Mountain Power Corporation ("Green Mountain Power" or the
"Company") (NYSE:GMP) announced today that Green Mountain Power
and Vermont-based Northern New England Energy Corporation ("NNEEC")
have entered into a definitive agreement whereby NNEEC will
acquire Green Mountain Power. Shareholders of Green Mountain
Power will receive $35.00 per share in cash or approximately
$187 million in the aggregate.
NNEEC is a Vermont corporation and a
wholly-owned subsidiary of Gaz Métro Limited Partnership (TSX-GZM.UN),
a leading Quebec energy company with a long history of
investment in Vermont. NNEEC has been the parent company of
Vermont Gas Systems since 1986.
The transaction has been approved by Green
Mountain Power's Board of Directors and will require the
approval of Green Mountain Power's shareholders. The transaction
is conditioned on, among other regulatory approvals and notices,
the approval of the Vermont Public Service Board and the Federal
Energy Regulatory Commission, and notice under the Hart-Scott-Rodino
Act. It is anticipated that the regulatory proceedings
should be completed within approximately 12 months. Upon
approval of state and federal regulators, Green Mountain Power
will join Vermont Gas Systems and Portland Natural Gas
Transmission Systems as one of NNEEC's New England-based energy
Green Mountain Power will continue to be
managed by its current leadership team and the Company will
continue to operate out of its existing offices in Vermont.
Employees will be retained and the current labor contract with
IBEW Local 300 will continue in place. The Company will remain
under the jurisdiction of state and federal regulators.
"This transaction will provide significant
benefits to our customers by making Green Mountain Power a much
stronger company at a critical time in our history and in
Vermont's energy future," said Chris Dutton, president and CEO
of Green Mountain Power.
"As we prepare to make important decisions
about Vermont's energy future relating to the expiration of our
existing long term power contracts, the financial strength and
market depth of Gaz Métro will significantly enhance our ability
to obtain the best value for our customers. In addition, the
transaction is expected to yield new investments in Vermont in
the areas of energy efficiency, distributed generation, and
potential district heating opportunities," said Mr. Dutton.
Gaz Métro is a major distributor of natural
gas in Quebec and the northeastern United States. In addition,
the company is a partner with Boralex in a large wind power
project in Quebec and operates businesses providing district
heating and urban water rehabilitation services in Quebec and
Ontario. As of the end of 2005, Gaz Métro had assets of more
than $2.5 billion (Canadian). There are 113 Vermont-based
employees of Vermont Gas Systems, a subsidiary of Gaz Métro. Gaz
Métro currently has a strong credit rating that, in recent
years, has been higher than Green Mountain Power's current BBB
"We view this new partnership as an excellent
match for Green Mountain Power's corporate values. Both
companies have strong track records of reinvesting earnings in
Vermont, environmental and social responsibility, expanding
energy efficiency, and transparent and collaborative
relationships with regulators and policy makers," added
"Gaz Métro is pleased to be expanding its
operations in Vermont through NNEEC's acquisition of Green
Mountain Power," said Robert Tessier, president and CEO of Gaz
Métro. "We are committed to increasing our investment in Vermont
and providing superior energy services to Vermonters. We have
demonstrated that commitment through our 20-year stewardship at
Vermont Gas Systems. With this acquisition of Green Mountain
Power, we will continue our practice of reinvesting earnings in
the state and our philosophy of local control through local
management. We are long-term investors and strongly believe
that, over time, investing in and growing our companies is in
the best interest of our customers, owners, employees and the
communities we serve. Green Mountain Power, like Vermont Gas,
fits our profile perfectly."
"As we analyzed this opportunity, Green
Mountain Power's Board of Directors became convinced that this
partnership will bring positive benefits to our shareholders,
customers and to the entire state of Vermont," said Nordahl Brue,
chairman of Green Mountain Power's Board of Directors. "I
believe Gaz Métro understands energy issues, it understands
finance, and most importantly, its long track record with
Vermont Gas demonstrates that it understands Vermont."
"We believe our association with Green
Mountain Power will further strengthen our companies," said
William Gilbert, of South Burlington, president of NNEEC. "Green
Mountain Power is a highly efficient company with excellent
customer service and a strong commitment to corporate
citizenship. NNEEC has a solid record of investment in Vermont,
having invested in excess of $100 million in earnings over the
past 20 years, and we expect to continue to invest in Vermont
through Green Mountain Power."
Banc of America Securities LLC acted as
exclusive financial advisor to Green Mountain Power and rendered
a fairness opinion to the Board of Directors of Green Mountain
Power in connection with the transaction.
The acquisition by NNEEC is one of many
corporate changes during Green Mountain Power's long history.
Green Mountain Power traces its roots to the Vergennes Traction
Company in 1893. Over the years it has had different owners,
including for a time being wholly-owned by New England Electric
System until 1951.
A press conference will be held today at 10:30 a.m. at Green
Mountain Power headquarters, 163 Acorn Lane, Colchester,
Vermont. Access to the conference will be available by webcast a
For further information, please contact Mark
Ray, Green Mountain Power Corporation, 802-655-8418.
This news release contains forward looking
statements about Green Mountain Power. Statements that are not
historical or current facts, including statements about beliefs
and expectations are forward looking statements. These
statements often include the words "may," "could," "would,"
"should," "believes," "expects," "anticipates," "estimates,"
"intends," "plans," "targets," "potentially," "probably,"
"projects," "outlook," or similar expressions. These
forward-looking statements cover, among other things,
anticipated future plans and prospects of Green Mountain Power.
Forward-looking statements speak only as of the date they are
made, and Green Mountain Power undertakes no obligation to
update them in light of new information or future events.
Forward-looking statements involve inherent
risks and uncertainties, and many factors could cause actual
results to differ materially from those anticipated, including
those described in the Annual Report on Form 10-K for the year
ended December 31, 2005, of Green Mountain Power, which you
should read carefully, as well as the Company's other filings
with the Securities and Exchange Commission (the "SEC"). The
following factors, among others, could cause actual results to
differ materially from the anticipated results or other
expectations expressed in the forward-looking statements:
(1) the businesses of Green Mountain Power and
NNEEC's subsidiary Northstars Merger Subsidiary Corporation may
not be combined successfully, or such combination may take
longer, be more difficult, time-consuming or costly to
accomplish than expected;
(2) governmental approvals of the merger may
not be obtained, or adverse regulatory conditions may be imposed
in connection with governmental approvals of the merger; and
(3) the shareholders of Green Mountain Power
may fail to approve the merger.
This communication is being made in respect of
the proposed merger transaction involving Green Mountain Power,
Northstars Merger Subsidiary Corporation and NNEEC. In
connection with the transaction, Green Mountain Power will file
a proxy statement with the SEC. Shareholders are urged to read
the proxy statement when it becomes available because it will
contain important information about the proposed transaction.
The final proxy statement will be mailed to Green Mountain Power
shareholders of record at the record date for the special
meeting of the shareholders to be held to approve the proposed
transaction. In addition, the preliminary and final proxy
statements and other relevant documents will be available free
of charge at the SEC's Internet website,
www.sec.gov. When available, the preliminary and final proxy
statement and other relevant documents also may be obtained for
free at the Green Mountain Power website,
www.greenmountainpower.biz, or by contacting Mark Ray, Green
Mountain Power Corporation, 802-655-8418.
Green Mountain Power and its directors and
officers and other members of management and employees may be
deemed to be participants in the solicitation of proxies in
respect to the proposed transactions. Green Mountain Power's
shareholders may obtain information regarding the identity of
each participant and a description of each participant's direct
or indirect interest in the solicitation from Green Mountain
Power's proxy statements and annual reports on Form 10-K
previously filed with the SEC and Green Mountain Power's proxy
statement relating to the proposed transaction, when it becomes
The information on our website is not, and
shall not be deemed to be, a part of this report or incorporated
into other filings we make with the SEC.