Iberdrola is to use the proceeds of the sale of three USA-based subsidiaries to finance a major infrastructure project in Maine.
The Spanish utility has completed the sale of three gas distribution firms in Massachusetts and Connecticut to US company UIL Holdings Corporation in a transaction valued at around $1.25 billion.
The three subsidiaries – Connecticut Natural Gas (CNG), Southern Connecticut Gas (SCG) and Berkshire Gas Company (BGC) – distribute approximately 56.5 billion cubic feet of natural gas per year to nearly 369 000 customers in the two states, and have a combined workforce of around 800 employers.
Iberdrola says the sale is part of its non-core asset divestment programme, which is designed to maintain the company’s financial strength while allowing investment in target markets. The transaction was completed after all the required regulatory approvals were obtained.
Proceeds from the sale of the gas companies will be used to finance the Maine Power Reliability Program (MPRP), which Iberdrola is building through its Central Maine Power subsidiary.
MPRP involves the investment of $1.4 billion to build around 500 miles of new and upgraded electricity transmission lines. The project will improve electricity distribution in Maine, New Hampshire and Massachusetts as well as the interconnection between Maine and Canada.
It will also support the development of new renewable energy resources and help to ensure long-term reliability for customers. MPRP will be completed in 2015.
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