JUNO BEACH, Fla. (AP) — NextEra Energy Inc. said Wednesday it plans to buy Hawaiian Electric Industries Inc. to expand clean energy in Hawaii.
The companies value the deal at $2.6 billion, or $4.3 billion including the assumption of Hawaiian Electric's debt.
NextEra owns one of the country's largest electrical utilities — Florida Power & Light Co. — as well as a major wind and solar energy company. Hawaiian Electric supplies power to 95 percent of Hawaii's population through its electric utilities.
The companies said that Hawaiian Electric shareholders will receive a fractional share in NextEra Energy stock, plus a one-time cash dividend and shares in a related spinoff company as part of the deal. They estimate the value of these shares and payments at $33.50 per share of Hawaiian Electric stock.
That's a premium of nearly 19 percent to the closing price of Hawaiian Electric's stock. In after-hours trading, shares of the company rose 15.7 percent to $32.61.
Hawaiian Electric plans to spin off its banking business as part of the deal. ASB Hawaii, the parent of American Savings Bank, will be spun off in a transaction expected to be tax-free to Hawaiian Electric shareholders.
Hawaiian Electric will keep its name and remain based in Honolulu, and no workforce cut are expected at the company for at least two years after the deal closes.
"NextEra Energy and Hawaiian Electric share a common vision, a more affordable clean energy future for Hawaii," said Connie Lau, Hawaiian Electric's president and chief executive. "While our goals are among the most ambitious in the nation, including increasing renewables to 65 percent, tripling solar and lowering customer bills 20 percent by 2030, we are confident that by leveraging both NextEra Energy and Hawaiian Electric's expertise and the additional financial resources that NextEra Energy brings, we can meet these targets even sooner."
The transaction is subject to approval by regulators and Hawaiian Electric shareholders, among other conditions, and is expected to close within a year.
NextEra, based in Juno Beach, Florida, expects that the deal will add to its earnings in the first year after closing.