NOVI, Mich., May 19, 2016 /PRNewswire/ -- ITC Holdings
Corp. (NYSE: ITC) announced that it will hold a special meeting of
its shareholders on June 22, 2016 at
which shareholders will be asked to adopt and approve the
previously announced transaction with Fortis Inc. (TSX: FTS).
On February 9, 2016, Fortis and
ITC announced that the two companies had entered into an agreement
and plan of merger pursuant to which Fortis will acquire ITC in a
transaction valued at approximately US$11.3
billion. Under the terms of the transaction, ITC
shareholders will receive US$22.57 in
cash and 0.7520 Fortis shares per ITC share upon the closing of the
transaction. Based on the closing price on February 8, 2016 for Fortis common shares and the
US$/C$ exchange rate, the per share consideration represents a
premium of 33% over ITC's unaffected closing share price on
November 27, 2015 and a 37% premium
to the unaffected average closing price over the 30 day period
prior to November 27, 2015.
Fortis announced on April 20, 2016
that it had reached a definitive agreement with GIC Private
Limited, Singapore's sovereign
wealth fund, to acquire a 19.9% equity interest in ITC for
aggregate consideration of US$1.228
billion in cash upon the closing of the transaction.
ITC shareholders of record as of the close of business on
May 13, 2016 are entitled to receive
notice of, and to vote at, the special meeting of shareholders. The
special meeting of shareholders will be held at 9:00 a.m., Eastern time, on June 22, 2016 at ITC's corporate headquarters
located at 27175 Energy Way, Novi,
MI 48377.
The board of directors of each of ITC and Fortis have approved
the proposed transaction. Fortis shareholders approved the
transaction on May 5, 2016 at the
Fortis Annual and Special Meeting of Shareholders.
The transaction remains subject to customary closing conditions,
including approval of the merger by holders of a majority of the
outstanding shares of ITC common stock, antitrust and other
regulatory and federal clearances.
The transaction is expected to close in late 2016.
About ITC
ITC Holdings Corp. (NYSE: ITC) is the nation's largest independent
electric transmission company. Based in Novi, Michigan, ITC invests in the electric
transmission grid to improve reliability, expand access to markets,
lower the overall cost of delivered energy and allow new generating
resources to interconnect to its transmission systems. Through its
regulated operating subsidiaries ITCTransmission, Michigan
Electric Transmission Company, ITC Midwest and ITC Great Plains,
ITC owns and operates high-voltage transmission facilities in
Michigan, Iowa, Minnesota, Illinois, Missouri, Kansas and Oklahoma, serving a combined peak load
exceeding 26,000 megawatts along approximately 15,700 circuit miles
of transmission line. ITC's grid development focus includes growth
through regulated infrastructure investment as well as domestic and
international expansion through merchant and other commercial
development opportunities. Additional information can be accessed
at www.itc-holdings.com or www.edgar.com. (ITC-itc-F)
About Fortis Inc.
Fortis Inc. is a leader in the North American electric and gas
utility business, with total assets of approximately $28 billion and fiscal 2015 revenue of
$6.7 billion. The Corporation's
asset mix is approximately 96% regulated (70% electric, 26% gas),
with the remaining 4% comprised of non‑regulated energy
infrastructure. The Corporation's regulated utilities serve
more than 3 million customers across Canada, the United
States and the Caribbean.
Fortis shares are listed on the TSX and trade under the symbol
FTS. Additional information can be accessed at
www.fortisinc.com or www.sedar.com.
Additional Information about the Acquisition and Where to
Find It
This communication may be deemed to be
solicitation material in respect of the proposed merger involving
ITC and Fortis. In connection with this proposed merger, Fortis has
filed with the SEC a registration statement on Form F-4 that
includes a prospectus of Fortis and a proxy statement of ITC, which
ITC filed with the SEC on May 16,
2016. The registration statement on Form F-4 was declared
effective by the SEC on May 16, 2016.
ITC mailed the definitive proxy statement/prospectus to its
shareholders on or about May 17,
2016. This communication is not a substitute for the proxy
statement/prospectus or any other document filed or to be filed by
ITC with the SEC in connection with the proposed merger. INVESTORS
AND SECURITY HOLDERS OF ITC ARE URGED TO READ THE PROXY
STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED OR TO BE FILED WITH
THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE
BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT
ITC, FORTIS, THE PROPOSED MERGER AND RELATED MATTERS. The
proxy statement/prospectus and other documents relating to the
proposed merger (when they are available) can be obtained free of
charge from the SEC's website at www.sec.gov. The documents, when
available, can also be obtained free of charge from ITC upon
written request to ITC, Investor Relations, 27175 Energy Way,
Novi, MI 48377 or by calling
248-946-3000.
Participants in the Solicitation of Proxies
ITC, Fortis and certain of their respective directors and executive
officers and certain other members of management and employees,
under SEC rules, may be deemed to be participants in the
solicitation of proxies in connection with the proposed merger.
Information about the directors and executive officers of ITC may
be found in its 2015 Annual Report on Form 10-K filed with the SEC,
its proxy statement on Schedule 14A relating to its 2016 Annual
Meeting of Shareholders and the proxy statement/prospectus, in each
case as filed with the SEC. Information about Fortis' directors and
executive officers may be found in its Management Information
Circular available on its website at www.fortisinc.com.
Additional information regarding the interests of such potential
participants in the solicitation of proxies in connection with the
proposed merger are contained in the proxy statement/prospectus
that ITC filed with the SEC on May 16,
2016.
Forward Looking Statements
This news release
contains forward-looking statements within the meaning of
applicable securities laws including the Private Securities
Litigation Reform Act of 1995. Forward-looking statements
included in this media release reflect Fortis' and ITC's
management's expectations regarding future growth, results of
operations, performance, business prospects and opportunities and
the outlook for ITC's business and the electronic transmission
industry based on information currently available. Wherever
possible, words such as "will", "anticipates", "believes",
"expects", "intends", "assumes", "estimates", "projects",
"expects", "plans", "seeks", "may", "could", "would", "can",
"continue" and the negative of these terms and other similar
terminology or expressions have been used to identify the
forward-looking statements, which include, without limitation,
those statements related to the proposed merger, the combined
company's future business prospects and performance, growth
potential, financial strength, market profile, revenues, proceeds,
working capital, capital expenditures, investment valuations,
liquidity, income, and margins, the satisfaction of the conditions
precedent to the closing of the proposed merger, the expectation
that Fortis will borrow funds to satisfy its obligation to pay the
cash portion of the purchase price and will issue securities to pay
the balance of the purchase price, the potential that termination
fees may be payable if the potential merger is not completed, the
future issuances of securities to repay or reduce the potential
merger bridge financing facilities, the percentage of Fortis common
shares to be held by ITC shareholders following the proposed
merger, the intention of ITC to seek shareholder approval in
relation to the proposed merger, the expectation that the proposed
merger will be accretive in the first full year following closing
and thereafter, that the proposed merger will support the annual
dividend growth target of Fortis, the availability of future
investment opportunities in the electrical transmission industry in
the United States, the United States federal regulatory
environment and expectations in respect of the continued support
for investment in the transmission industry by FERC, the
expectation that Fortis will maintain an investment-grade credit
rating and will become an SEC registrant and have its common shares
listed on the NYSE in connection with the proposed merger, the
expectation that ITC will continue to operate as an stand-alone
company following the proposed merger, will retain its current
employees and will continue to be based in Novi, Michigan, the timing of closing of the
proposed merger, the amount of indebtedness of ITC Holdings
expected to have been incurred as of closing, and the impact of the
CPP on the electrical transmission industry in the United States. These statements reflect
management's current beliefs and are based on information currently
available to Fortis' and ITC's management.
Forward-looking statements involve significant risk,
uncertainties and assumptions. Certain material factors or
assumptions have been applied in drawing the conclusions contained
in the forward-looking statements. These factors or assumptions are
subject to inherent risks and uncertainties surrounding future
expectations generally, including those identified from
time-to-time in the forward-looking statements. Such risk factors
or assumptions include, but are not limited to, risks relating to
regulation and energy prices, the ability to obtain shareholder and
regulatory approvals in connection with the proposed merger and the
timing and terms thereof, state and federal regulatory legislative
decisions and actions, interloper risk, risks relating to
uncertainty relating to the completion of the proposed merger and
the timing thereof, the risk that conditions to the proposed merger
may not be satisfied, risks relating to the focus of management
time and attention on the proposed merger and other disruption from
the proposed merger making it more difficult to maintain business
and operational relationships, the possibility that the expected
synergies and value creation from the proposed merger will not be
realized, or will not be realized within the expected time period,
the risk that ITC will not be integrated successfully, risks
relating to the potential decline in the Fortis share price
negatively impacting the value of the consideration offered to ITC
shareholders, risks relating to the constraints that the minority
investment may impose on Fortis' ability to operate the ITC
business in accordance with its business plan following closing,
risks relating to the ability of Fortis to access capital markets
on favourable terms or at all, the cost of debt and equity capital,
risks relating to the ability of Fortis to satisfy the conditions
precedent in the bridge financing facilities in order to access
funds to complete the proposed merger, general economic, market and
political conditions, changes in regional economic and market
conditions which could affect customer growth and energy usage,
weather variations affecting energy use, the performance of the
stock market and changing interest rate environment, which affect
the value of pension and other retiree benefit plan assets and the
related contribution requirements and expense, risks relating to
derivatives and hedging, currency exchange rates, interest rates,
capital resources, loss of service area, licences and permits,
environmental risks, insurance risks, labour relations, risks
relating to human resources, liquidity risks, resolution of pending
litigation matters, changes in accounting standards, changes in
critical accounting estimates, the ongoing restructuring of the
electric industry, changes to long-term contracts, the cost of fuel
and power supplies, cyber-attacks or challenges to our information
security, and certain presently unknown or unforeseen factors,
including, but not limited to, acts of terrorism. Fortis and ITC
caution readers that a number of factors could cause actual
results, performance or achievements to differ materially from the
results discussed or implied in the forward-looking statements.
These factors should be considered carefully and undue reliance
should not be placed on the forward-looking statements. For
additional information with respect to certain of these risks or
factors, reference should be made to the continuous disclosure
materials filed from time to time by Fortis with Canadian
securities regulatory authorities and to ITC's filings with the
SEC, including the proxy statement/prospectus filed by ITC in
connection with the proposed merger. Fortis and ITC disclaim
any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
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SOURCE ITC Holdings Corp.