MONTPELIER, Vt. (AP) — Vermont's second-largest electric utility company announced Thursday that it was being acquired by a Canadian company.
Green Mountain Power Corp. said the deal with Gaz Metropolitain LP of Montreal was valued at $187 million in cash and its stockholders would get $35 per share if it is approved.
Shares of Green Mountain Power rose $5.71, or 20 percent, to $33.70 in late morning trading on the New York Stock Exchange.
The acquirer is Gaz Metro subsidiary Northern New England Energy Corp., which owns Vermont Gas Systems, based in South Burlington, and Portland Natural Gas Transmission Systems based in Portsmouth, N.H.
Green Mountain Power is in the midst of searching for new energy supplies because contracts with its biggest sources - the Hydro-Quebec utility in Montreal and the Vermont Yankee nuclear power plant — are expiring over the next decade.
Those contracts price the electricity much lower than current market prices. Green Mountain Power suggested in its news release that it was looking for a partner with deep pockets as it contemplates the future.
''The financial strength and market depth of Gaz Metro will significantly enhance our ability to obtain the best value for our customers,'' Green Mountain Power President Chris Dutton said in a statement.
Green Mountain Power noted that Gaz Metro has assets of 2.5 billion Canadian dollars, and has made $100 million in investments in its Vermont Gas subsidiary over the past 20 years.
''I believe Gaz Metro understands energy issues, it understands finance, and most importantly, its long track record with Vermont Gas demonstrates that it understands Vermont,'' said Nordahl Brue, chairman of Green Mountain's board.
The agreement calls for Green Mountain Power to continue to be a freestanding company led by its current management team based in Colchester, the company said. Its existing employees would keep their jobs, it said.
''With this acquisition of Green Mountain Power, we will continue our practice of reinvesting earnings in the state and our philosophy of local control through local management,'' Gaz Metro President Robert Tessier said in a statement.
The proposed sale requires the approval of Green Mountain Power shareholders, state and federal regulators.