Hawaiian Electric Industries, Inc. today announced that HEI shareholders have approved the merger agreement with NextEra Energy, Inc. announced Dec. 3, 2014.
“We’re extremely pleased that our shareholders, many of whom are Hawaiian Electric, Maui Electric and Hawaii Electric Light customers, have shown their strong support for this historic partnership by approving the proposed merger,” said Jeff Watanabe, HEI’s chairman of the board. “The approval marks another significant milestone in our efforts to accelerate Hawaii’s clean energy transformation by bringing the expertise and resources of NextEra Energy to our state to achieve even higher levels of renewables and lower energy costs for our customers.”
Of the shares voted, approximately 90 percent were in favor of the merger. Achieving this level of shareholder support is a significant accomplishment because, while publicly held companies commonly may proceed with a merger with the affirmative vote of a majority of their outstanding shares, HEI is required under Hawaii law to obtain supermajority approval from 75 percent of its outstanding shares.Hawaii is the only state with such a high approval requirement for a merger.
The merger will bring together two industry leaders in clean and renewable energy. Hawaiian Electric has put Hawaii on the leading edge of clean energy nationally, successfully integrating rooftop solar with 12 percent of its residential customers and helping meet 21 percent of customer electricity needs from renewable energy resources. NextEra Energy has developed, built and operates one of the nation’s most modern grid networks and is the world’s largest producer of renewable energy from the wind and sun. NextEra Energy supports and will help accelerate Hawaiian Electric’s plans to lower electric bills, triple distributed solar – including rooftop solar – and achieve a 65 percent renewable portfolio standard (RPS) by 2030. This week Gov. David Ige signed a bill into law that set a goal of 70 percent RPS by 2040 and 100 percent RPS by 2045 for the state—goals which Hawaiian Electric and NextEra Energy have each stated they fully support.
“We’re confident that this merger will help us more quickly achieve the affordable clean energy future we all want for Hawaii,” saidConnie Lau, HEI’s president and chief executive officer and chairman of the boards of Hawaiian Electric and American Savings Bank. “We’re proud to support a measure recently passed by the legislature and signed by our governor making Hawaii the first state in the nation to adopt a 100 percent renewable energy portfolio standard. Partnering with NextEra Energy will strengthen and accelerate our ability to reach our state’s ambitious goals.”
The merger with NextEra Energy is expected to provide Hawaiian Electric with the added resources and access to expertise to accelerate Hawaii’s clean energy transformation, while delivering substantial customer benefits, including lower costs. Subject to approval by the Hawaii Public Utilities Commission (PUC), the companies have committed to approximately $60 million in customer savings over four years and to not request an increase in the general base electricity rate for at least four years post-transaction close. Following completion of the transaction, Hawaiian Electric will continue to operate under its current name, be locally managed, and remain headquartered in Honolulu. HEI is one of Hawaii’s most charitable companies and NextEra Energy will continue HEI’s overall current level of corporate giving in Hawaii.
While the Federal Energy Regulatory Commission (FERC) has approved the proposed merger, the transaction remains subject to other regulatory approvals including approval by the PUC, other customary closing conditions and the spinoff of American Savings Bank, a subsidiary of HEI and one of Hawaii’s largest full-service financial institutions. Following the spinoff, American Savings Bank will remain based in Hawaii as an independent public company, and continue to provide a full range of financial products and services, including business and consumer banking, insurance and investments, corporate banking and commercial real estate lending.
“The spinoff of American Savings Bank as a condition to completing the merger enables shareholders to continue to own American Savings Bank and to participate in the bank’s upside potential as an independent public company,” said Connie Lau. “Our ability to spin off American Savings Bank reflects the strength of the bank’s business, its strong market position and its talented team of employees.”
ST Staff Writers
This post was prepared by Solar Thermal Magazine staff.