Portland General Electric Company (NYSE: POR) today announced an agreement to acquire select Washington state generation, transmission and electric utility operations from PacifiCorp for $1.9 billion. The acquisition will enable PGE to extend its long-standing commitments to reliability, affordability, economic development and a customer-centric approach to approximately 140,000 Washington customers.
“We are excited for the opportunity to continue to grow, expanding into Washington and building upon PGE's foundation of operational excellence and customer service," said Maria Pope, president and CEO. "We look forward to our partnership with Manulife Investment Management, who brings a track record of investment success across the utility sector and Pacific Northwest agriculture and timberland industries."
Under the agreement, PGE will acquire three generation facilities: the Chehalis natural-gas plant (477 MW), the Goodnoe Hills wind facility (94 MW), and the Marengo I and II wind facilities (234 MW). The acquisition also includes 4,500 miles of transmission and distribution lines, and local utility operations across 2,700 square miles.
PGE will manage the Washington operations as a separate company through a newly formed subsidiary regulated by the Washington Utilities and Transportation Commission. PGE will retain current Washington employees and honor the existing labor process. PGE corporate functions will provide shared support for both Washington and Oregon companies.
Washington and Oregon customers will not be impacted by costs associated with executing the acquisition and transaction financing. PGE expects the state and federal regulatory reviews of the acquisition to close 12 months after submission of regulatory filings.
Central to this acquisition is PGE’s partnership with Manulife Infrastructure Fund III L.P. and its affiliates including John Hancock Life Insurance Company (USA), which will collectively be a 49% owner of the Washington utility business. Manulife Investment Management is an experienced, long-term investor in infrastructure, agriculture, and timberland with roots in the region — having managed farms and forests in the Pacific Northwest for more than two decades.
“We are pleased to partner with PGE to support this investment in reliable generation, transmission, and distribution for Washington communities,” said Recep Kendircioglu, Global Head of Infrastructure, Manulife Investment Management. “This partnership represents an opportunity that fits well within our infrastructure strategy and leverages our experience in utility investments.”
Lazard served as lead financial advisor and provided a fairness opinion to Portland General Electric. Barclays, J.P. Morgan and Citi also served as financial advisors to Portland General Electric. Latham & Watkins served as legal advisor to Portland General Electric.
Goldman Sachs & Co. LLC served as financial advisor to Manulife Investment Management. Simpson Thacher & Bartlett LLP served as legal advisor to Manulife Investment Management.
Source: Portland General Electric