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Hydro One, Avista Pick Independent Directors for Post-Merger Avista Board
Thursday 08 November 2018

8 November 2018 - Canada-based electricity transmission and distribution provider Hydro One Ltd. (TSX: H) and Washington, US-based energy company Avista Corp. (NYSE: AVA) have named the five independent directors selected to serve on the new Avista board of directors, if the proposed merger is approved by utility commissions in Washington, Idaho and Oregon, the companies said.

This deal was announced last July.

Under the deal, Hydro One will acquire Avista for CDN 6.7bn (USD 5.3bn) in an all-cash transaction.

Hydro One and Avista will create a North American regulated electricity and natural gas business with over CDN 32.2bn (USD 25.4bn) in combined assets. The transaction brings together two regulated utilities that will serve more than two m retail and industrial customers and hold assets throughout North America, including Ontario, Washington, Oregon, Idaho, Montana and Alaska.

The transaction was unanimously approved by the boards of directors of both companies and is expected to close in the second half of 2018.

The proposed merger has received regulatory approval from the Alaska and Montana commissions and other federal agencies.

As outlined in the proposed merger commitments pending before the commissions, two independent directors were selected by Avista and three independent directors were selected by Hydro One.

All five selections are independent of both organizations, as defined by New York Stock Exchange rules, and have ties to the US Pacific Northwest.

The four remaining directors will include Avista's current CEO and chairman, Scott Morris, continuing in his role as chairman, current Avista president and director Dennis Verm, the CEO of Hydro One and one other senior executive from Hydro One, to be named.

Seven of the nine total directors have ties to the US Pacific Northwest, with six of these serving as current Avista directors or employees, ensuring that these directors are familiar with Avista's service territory.

The independent directors were selected at this time so that the Avista board of directors would be prepared and ready to begin serving their terms assuming the proposed transaction is approved and closes, which is requested by the end of this year.

The newly selected directors include Kristianne Blake (Avista selection). Blake serves on the current Avista board of directors as lead director and has been an Avista director since 2000.

She is a long-time resident of Spokane, Washington and has a rich history of involvement in the Spokane community. She has been the president of the accounting firm of Kristianne Gates Blake, P.S. since 1987 and has an extensive background in public accounting. She was a Certified Public Accountant for 33 years, and she worked for 13 years for an international accounting firm.

Blake is also currently serving as board chair for the Russell Investment company and the Russell investment Funds.

Donald Burke (Avista selection) serves on the current Avista board of directors as the chair of the audit committee and has been an Avista director since 2011.

As a director, he serves as the board's designated financial expert. He also currently serves as an independent director for the Virtus mutual fund complex and Duff and Phelps closed-end funds complex.

From 2006 to 2010, Burke served as a trustee for numerous global funds that were advised by BlackRock, Inc. From 2006 to 2009, he was a managing director of BlackRock and served as the president and CEO of the BlackRock US mutual funds.

In this role, Burke was responsible for all of the accounting, tax and regulatory reporting requirements for over 300 open and closed-end mutual funds. Burke joined BlackRock in connection with the merger with Merrill Lynch Investment Managers, taking a lead role in the integration of the two firms' operating infrastructures.

While at MLIM, Burke was the Head of Global Operations and Client Services and also served as the treasurer and chief financial officer of the MLIM mutual funds.

Christine Gregoire (Hydro One selection) is the CEO for Challenge Seattle, an organization comprised of 18 major international companies and non-profits located in the Seattle region.

Previously, she served for two terms as Governor of the State of Washington with a USD 32bn biennial budget and over 60,000 employees. In her first term as Governor, she created the Department of Early Learning and led on reforms to the K-12 system and investment in higher education.

She led the state in a historical investment in infrastructure, addressed the water wars in the state, led an historic number of trade missions, reformed the foster care system to protect children and was among the first to lead in health care reform.

During her second term, Gregoire led the state in major reforms, management and budgeting to position the state as one of the most financially secure to come out of the "Great Recession."

Prior to becoming Governor, she served for three terms as Attorney General for the State and prior to becoming Attorney General, she served four years as the director of the State Department of Ecology.

Gregoire recently completed her third year as chair on the National Export-Import Bank advisory board. She is a graduate of Gonzaga University School of Law, and she and her husband also have a home in north Idaho.

Scott Maw (Hydro One selection) serves on the current Avista board of directors and has been an Avista director since 2016.

He has been executive vice president and CFO for Starbucks Coffee company since February 2014. He is responsible for Starbucks' Global Finance organization.

Prior to that, he served as senior vice president of Corporate Finance for Starbucks where he was responsible for corporate finance, including accounting, tax and treasury. Maw also had oversight for all financial and securities-related regulatory filings.

He joined Starbucks as global controller in 2011. Prior to joining Starbucks, Maw served as CFO of SeaBright Insurance company from 2010 to 2011.

From 2008 to February 2010 he served as CFO of the Consumer Banking division of JPMorgan Chase and Co. He is a Seattle, Wash. resident, with roots in Eastern Washington. He graduated from Deer Park High School, just north of Spokane, and is a graduate of Gonzaga University.

Marc Racicot (Hydro One selection) serves on the current Avista board of directors and has been an Avista director since 2009.

He served as president and CEO of the American Insurance Association from August, 2005 to February, 2009. Prior to that, he was a partner at the law firm of Bracewell and Giuliani, LLP from 2001 to 2005.

He is a former governor (1993 to 2001) and attorney general (1989 to 1993) of the state of Montana. Racicot was nominated by president Bush and unanimously elected to serve as the chair of the Republican National Committee from 2002 to 2003 prior to assuming the position of chair of the Bush/Cheney Re-election Committee from 2003 to 2004.

Applications for regulatory approval of the transaction are still pending with utility commissions in Washington, Idahoand Oregon. All approvals have been requested by December 14, 2018; however the utility commissions will determine when they issue their final orders.
Details
Date Published: 08/11/2018
Target: Avista Corp
Country: USA
Deal Size: 5.5bn (USD)
Sector: Utilities
Type: Corporate acquisition
Financing: Cash
Status: Agreed
Vendor:
Buyer: Hydro One Ltd
Buyer Advisor: Moelis and Co , Bracewell
Comment:


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