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Province of Ontario sells shares in Hydro One to First Nations groups [free access]

January 3, 2018

The province of Ontario has sold its more than 14 million shares (representing 2.4 per cent of its total shares) in Hydro One to OFN Power Holdings LP, a limited partnership wholly-owned by Ontario First Nations Sovereign Wealth LP, which is in turn owned by 129 First Nations in Ontario. The deal, totalling nearly CAD260 million, was aimed at strengthening economic relations between Ontario and its indigenous people; and has brought the ownership of the province in the electricity distribution company down from 49.9 per cent to 47.4 per cent.

 

The shares were priced at CAD18 per piece and have been purchased by the First Nations group through a province-backed 25-year loan of CAD259 million. The interest on this will be calculated at the Ontario’s relevant borrowing rate, plus 15 basis points. The sold shares have been pledged as a security for the term loan and the province has also provided a seed capital of CAD29 million in cash to the First Nations.

 

Ontario does not expect to sell any more common shares in Hydro One, but will continue to review its investment options.

 

(CAD1=USD0.95)