Avista strikes deal to acquire electric utility in Alaska
Avista Corp. is moving into the Alaska market through the planned purchase of an electric utility serving the Juneau area.
In a deal announced Monday, Avista will acquire Alaska Electric Light and Power’s parent company through a $170 million stock transaction. The sale is expected to close by July 1, subject to regulatory approvals.
“It gives us a small utility in Juneau” whose power generation is nearly 100 percent renewable, said Jessie Wuerst, an Avista spokesman.
The Alaska utility has about 60 employees and serves about 16,000 customers. Nearly all of its electricity comes from five hydropower dams within a 40-mile radius of Juneau, including a small dam at Gold Creek in the city’s downtown. Last year, Alaska Electric Light and Power had revenues of $42 million.
The privately held utility dates to 1894. For most of its history, the Corbus family of Juneau has been the utility’s major stockholder and has taken an active role in its management, said Scott Willis, vice president of generation.
With no family members interested in running the company, the board of directors was searching for a buyer. The board wanted to sell to a company that would continue to provide reliably priced electricity and take an active role in Juneau’s civic affairs, according to a statement released by Alaska Electric Light and Power.
The sale to Avista will give shareholders liquidity and put the utility in the hands of a company with a similar corporate culture, the statement said.
Avista will issue $170 million worth of its stock to Alaska Electric Light and Power’s shareholders, minus the amount of debt assumption and other closing costs.
The acquisition is expected to have a slight negative effect on Avista’s earnings next year, and contribute positively to the utility’s earnings in 2015, according to a company statement.
The acquisition represents Avista’s first utility purchase since 1994, when it took over electric service in Sandpoint from Pacific Corp.
Avista serves 362,000 electric customers and 322,000 natural gas customers in the Northwest. Last year, it had revenues of $1.5 billion.