Emera (TSX:EMA) has completed its acquisition of all outstanding shares of TECO Energy for approximately (U.S.)$6.5bn, Emera said recently.
TECO will now become a subsidiary of Nova Scotia-based Emera. The deal was approved by FERC in January. The deal was announced in September 2015.
TECO Energy is a “perfect fit” for Emera’s strategy due to its business and generation mix, Emera said in a July 1 news release.
It expands Emera’s platform into markets where there are significant growth opportunities, and is expected to increase the portion of Emera’s earnings from rate-regulated businesses to almost 85% of adjusted net income. With this acquisition, Emera becomes a top 20 North American regulated utility with added geographic, regulatory and business diversification, the company said.
The acquisition is expected to be significantly accretive to Emera’s earnings per common share, with 5% accretion in the first full year of operations (2017), growing to more than 10% by the third full year (2019).
“The acquisition of TECO Energy advances a number of important strategic objectives for Emera,” said Emera President and CEO Chris Huskilson. “We expect it to be significantly accretive, increase our regulated earnings into the high end of our target range, provide additional diversification and growth opportunities, and expand Emera into the local gas distribution business.”
Emera said operating boards will be established in Florida and New Mexico, with local business and community leaders on both boards. Tampa Electric and Peoples Gas headquarters will remain in Tampa, Florida. New Mexico Gas Co. headquarters will remain in Albuquerque, New Mexico.
“At Emera, our people are our greatest strength. Today, we welcome 3,700 new colleagues from across TECO into the Emera family. We are stronger together,” said Huskilson.
Tampa Electric serves nearly 725,000 customers in West Central Florida; Peoples Gas serves nearly 365,000 customers across Florida; and New Mexico Gas Co. serves more than 515,000 customers across New Mexico.
Emera is a geographically diverse energy and services company headquartered in Halifax, Nova Scotia with approximately $27.5bn in assets and 2015 pro-forma revenues of $ 6.3bn. The company invests in electricity generation, transmission and distribution, gas transmission and distribution, and utility energy services. Emera has investments throughout North America, and in four Caribbean countries.