Fortis Inc. Expands Influence Through Caribbean Utilities Offering
Fortis Inc. Expands Its Reach with a Strategic Commitment
Fortis Inc., a prominent player in the North American utility landscape, has recently made headlines with an exciting announcement. Its wholly owned subsidiary, Fortis Energy Caribbean Inc. (FECI), is set to provide a standby commitment for Caribbean Utilities Company, Ltd. (CUC). This commitment is part of a rights offering aimed at generating crucial capital for CUC's ongoing initiatives.
Understanding the Standby Commitment
Through this rights offering, Caribbean Utilities Company plans to issue around 3,822,298 Class A Ordinary Shares, equating to 10% of its currently outstanding shares. FECI is poised to exercise its rights and will initially acquire a minimum of 2,220,422 CUC Shares, paying US$13.41 per share, which sums up to a total investment of US$29,775,859.02.
Moreover, FECI has the option to acquire an additional 1,601,876 CUC Shares at the same price under the standby commitment. Should the offering not attract other subscribers, FECI could end up holding the full allotment of 3,822,298 shares, with the total financial commitment reaching around US$51,257,016.18. When converted using the current exchange rates, this commitment reflects a value of C$18.19 per CUC Share, creating a substantial overall investment of C$69,527,600.62.
Fortis's Ownership Goals
Prior to this rights offering, Fortis held around 22,204,229 shares of CUC, representing approximately 58% of its ownership. Once the offering wraps up—anticipated around early November, Fortis could beneficially control nearly 58% of the shares if fully subscribed. However, if no other subscribers participate, its ownership stake could rise to about 62%.
Funding Alternative Energy Projects
The main objective behind CUC's rights offering is to secure funding for various essential projects, particularly alternative energy initiatives. This financial boost will aid in the enhancement of CUC's existing generation, transmission, and distribution systems, aligning with a broader commitment to sustainable energy solutions.
Future Considerations for Fortis
Fortis aims to remain proactive in managing its holdings in CUC. The corporation will review its share ownership consistently and may make additional purchases or sell securities in the market, depending on the prevalent market conditions and available investment prospects.
Regulatory Compliance
In line with regulations, Fortis will submit an early warning report concerning this transaction, ensuring transparency and adherence to legal requirements. For any inquiries regarding the report, interested parties can reach out to Ms. Karen McCarthy, Vice President, Communications & Government Relations, via media@fortisinc.com.
About Fortis Inc.
Fortis Inc. stands tall as a leader in the utility market across North America, boasting 2023 revenues of $12 billion and total assets valued at approximately $69 billion as of mid-2024. With 9,600 dedicated employees, Fortis serves a diverse customer base across five Canadian provinces, ten U.S. states, and several Caribbean nations. The company's shares are actively traded on major stock exchanges under the ticker FTS.
Its headquarters are situated at Fortis Place, Suite 1100, 5 Springdale Street, St. John’s, Newfoundland and Labrador, A1B 3T2.
Frequently Asked Questions
What is the purpose of Fortis Inc.'s standby commitment?
The standby commitment aims to support Caribbean Utilities Company in capitalizing on ongoing projects, particularly in alternative energy and infrastructure upgrades.
How many shares will Fortis acquire through this offering?
Fortis plans to initially acquire 2,220,422 CUC Shares, with the potential to purchase an additional 1,601,876 shares depending on the offering participation.
What percentage of CUC will Fortis control post-offering?
Fortis could control approximately 58% of CUC if the offering is fully subscribed, or up to 62% if no other subscribers participate.
Who should be contacted for more information about the early warning report?
Interested individuals can contact Ms. Karen McCarthy, Vice President of Communications & Government Relations, for further information regarding the early warning report.
What is Fortis Inc. known for?
Fortis Inc. is recognized as a diversified leader in the regulated electric and gas utility sector, with significant revenues and assets across North America.
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