Durham Region, Ontario: The parent companies of three major southern Ontario local distribution companies – Veridian Corporation (Veridian), Oshawa Power and Utilities Corporation (OPUC) and Whitby Hydro Energy Corporation (WHEC) – announced the signing of a Memorandum of Understanding (MOU) April 28, to explore the potential benefits and feasibility of a merger.
Together, the three entities currently service more than 220,000 customers in a growing area of the province.
The MOU was created and signed after all three organizations agreed that it would be mutually beneficial to pursue opportunities for collaboration and integration to the benefit of their shareholders, employees, and customers.
"At this preliminary stage, the MOU's purpose is to set in motion an exploratory phase that will identify potential benefits that can be realized through a consolidation," said Michael Angemeer, President and CEO of Veridian. "The timing also makes sense, as Ontario has created a policy framework in favour of utility integration that has resulted in successful mergers west of Toronto that will act as a catalyst for economic growth in those parts of the province." He added that, "The mergers and acquisitions that have formed Veridian have resulted in benefits to shareholders, communities, customers and employees while achieving a high level of reliability and employee and public safety."
The 2012 Ontario Distribution Sector Panel Review and the 2015 Advisory Council on Government Assets have supported a provincial government policy framework in favour of utility consolidation. As a result, increased activity in consolidations of local distribution companies has taken place across Ontario.
Key objectives outlined in the MOU include creating opportunities to increase efficiencies and innovation for the benefit of the customers and that would enable customer service levels to meet or exceed existing levels.