PowerStream Inc.

PowerStream Inc.

April 30, 2008 13:03 ET

PowerStream and Barrie Hydro Discussing Merger

Proposed merger would create Ontario's second largest distribution utility

YORK REGION, ONTARIO--(Marketwire - April 30, 2008) - PowerStream Inc., the local electricity distribution company owned by the City of Vaughan and the Town of Markham which also serves customers in Aurora and Richmond Hill, has agreed to negotiate a non-binding Letter of Intent to pursue a merger with Barrie Hydro Distribution Inc. Signing a Letter of Intent will permit further investigation into the strength of the business case associated with a proposed merger.

A Joint Steering Committee has been appointed with four (4) members representing each utility to facilitate matters relating to a potential merger. The Committee will finalize a Letter of Intent and continue the review of the potential impact of a merger of the utilities on issues such as:

- Distribution rates for residential and general service customers

- Dividend payments to Shareholders

- Employees

- Relative ownership of the merged utility

- Operating costs and financial stability

- Service reliability

A Letter of Intent and any subsequent merger agreement would provide that there would be one (1) head office and a minimum of two (2) operation/administration centres, one of which must be located in the City of Barrie. In addition, it would include a number of items that would require the unanimous consent of all shareholders.

It is anticipated that investigation of the business case and any subsequent agreements required to amalgamate the two utilities will be completed prior to the end of August. Any merger agreement will be subject to the approval of both utilities' Board of Directors and that of their respective shareholders. Further, any agreement to amalgamate will also require the approval of the Ontario Energy Board.

PowerStream Inc. is the third largest local electricity distribution company (LDC) in Ontario, serving more than 237,000 customers in four municipalities. Barrie Hydro Distribution Inc. is the Province's 12th largest LDC with more than 68,000 customers in seven service areas. A merger of the two utilities would create the second largest LDC in Ontario.

To see a backgrounder, please visit the following link: http://media3.marketwire.com/docs/430powerstream_backgrounder.pdf.

Contact Information

  • PowerStream Inc.
    Eric Fagen
    Corporate Communications Manager
    (905) 532-4522 or Media Line (24/7): (905) 532-4400
    Email: eric.fagen@powerstream.ca