ITC Holdings Ends $1.8 Billion Entergy Purchase
NOVI (WWJ) -- Novi-based ITC Holdings Corp. (NYSE: ITC) Friday announced it would give up on a $1.8 billion transaction to buy the high-voltage power lines of the New Orleans utility Entergy.
The decision came three days after the Mississippi Public Service Commission has rejected the deal, saying it could result in $300 million in rate hikes for Mississippi electric customers over 10 years.
The deal, announced two years ago, had already been approved by the federal government and ITC shareholders.
ITC contended it had made commitments to hold Mississippi ratepayers harmless from rate hikes, but state regulators there weren't convinced.
The deal included 15,000 miles of high-voltage lines in Arkansas, Louisiana, Mississippi and Texas. Other states and the city of New Orleans had not yet ruled on the deal.
ITC is the only publicly traded owner of interstate high-voltage lines.
ITC chairman, president and CEO Joseph L. Welch said in a statement: "Since our announcement of this transaction, we have been diligent in our pursuit of the necessary regulatory approvals that would allow us to bring the benefits of our independent transmission model, singular focus and superior performance as a transmission operator to the Entergy region to deliver value and improved service to customers. I am truly sorry that customers in this region will not realize the benefits that this transaction would have brought and that they so deserve."
In the statement, Welch also said that ITC's "stand-alone business plan ... positions us well to continue to deliver benefits to our customers and shareholders going forward. Our accomplishments over this period have been significant and are a testament to our focus, commitment and independent transmission business model. These accomplishments include the completion of significant capital projects in Kansas, Oklahoma, Iowa and Michigan; continued operational and reliability improvements in our existing footprints; and the advancement of the regional multi-value projects in Michigan, Iowa, Minnesota and Wisconsin."
In a conference call with analysts Oct. 31, ITC executives said the company could achieve double-digit revenue growth even without the Entergy deal.
More at www.itc-holdings.com.
