NextEra terminates merger agreement with Hawaiian Electric

In its decision, the PUC said that although NextEra is fit, willing, and able to step into HEI’s shoes without hurting the company’s performance, the application was not in the public interest.

“Looking forward, NextEra Energy remains extremely well-positioned to execute on our strategy and deliver exceptional results for our customers and shareholders”, commented Jim Robo, chairman and CEO of NextEra Energy. Based on its review of the record, the commission concluded that although the applicants demonstrated that NextEra is fit, willing and able to perform the services now offered by HEI and its three electric utilities, the applicants failed to demonstrate that the merger would be reasonable and be in the public interest. The regulator highlighted concerns about the risks and benefits to utility customers and Next Era’s clean-energy commitments.

The PUC was careful to clarify that its decision did not mean that it would not approve a future merger, acquisition, or other application for change in control of HEI.

HECO originally requested approval from PUC in late May 2016, claiming that, if the merger was not approved, HECO would still be interested in pursuing LNG by itself, but that the companies would need to negotiate a new contract. State lawmakers were reportedly considering legal action because the change was made without Senate confirmation.

Thomas Gorak, the commissioner who was recently appointed and abstained from the vote, said he supports the decision. NextEra and HEI could have challenged the PUC decision, but instead will walk away from the deal.

NextEra Energy, Inc. has terminated its bid to merge with Hawaiian Electric Industries, the companies announced Monday.

The company, also the owner of Florida Power and Light and renewable-energy subsidiary NextEra Resources, proposed the $4.3-billion merger in December 2014.

As a result of the deal cancellation, NextEra will pay a break-up fee of United States dollars 90 million along with up to USD 5 million for reimbursement of expenses associated with the transaction, it said.