Green Mountain announces acquisition of Central Vermont Public Service

Green Mountain Power, a subsidiary of Gaz Metro, has signed an agreement to purchase and merge with Central Vermont Public Service.

Green Mountain, known for its cutting-edge solar incentives and vast investment in renewable energy initiatives, has long been the second largest utility in Vermont, said Dotty Schnure, Green Mountain spokeswoman. But, if this purchase and merger are approved by governing bodies in Vermont, Green Mountain Power will be the largest by far.

The all-cash transaction will provide Central Vermont shareholders $35.25 per common share, a 45 percent premium over the closing price of $24.32, according to a press release about the merger.

Green Mountain bid against Fortis Inc. for the competing utility, according to the release. Central Vermont had announced a deal with Fortis not long before the bid from Green Mountain came in, and the utility declared Green Mountain’s offer superior.

“We’ll be able to take the best of both companies and combine them to benefit customers,” Schnure said.

The press release indicated that the merger would result in major savings for the utilities that could be passed on to customers, saving them roughly $144 million.

A contiguous service territory and one Operation Headquarters will streamline storm response to restore power faster and reduce the overall frequency and duration of outages, according to the release. Also, with the benefit of the combined utility’s information technology resources, it will be able to move basic services online more swiftly, and allow customer service representatives to provide more personalized service, which will be especially important for the implementation of the statewide Smart Grid initiative.

Schnure said the acquisition would help Green Mountain to promote its solar incentive. While the state legislature recently voted into existence a law that requires all utility providers to offer solar incentives, Green Mountain pioneered the concept in Vermont.

“A lot of solar installers said they targeted our service area not just because of the incentives,” she said, “but also because we had perfected the process for getting new systems connected to the grid.”

The deal will take some time to process before it can be finalized, Schnure said.

Pictured: Mary Powell, Green Mountain Power's CEO.