Avista Corp. said today is will buy Alaska Energy and Resources Co., a closely held firm based in Juneau, Alaska, for $170 million.
Spokane-based Avista, which supplies natural gas to Jackson and Josephine counties, said AERC will become a wholly-owned subsidiary when the deal is closed, most likely in the second quarter of 2014.
Avista said the final purchase price will be lessened by assumed debt and other closing adjustments. Avista will issue new shares of its stock to AERC owners. The deal is subject to regulatory approval.
Avista said the acquisition will be "slightly negative" to 2014 earnings, but will add to earnings in 2015.
The primary subsidiary of AERC is Alaska Electric Light and Power Co., the oldest regulated electric utility in Alaska. In 2012, AEL&P had annual revenues of $42 million and a total rate base of $111 million.
In addition to the regulated utility, AERC owns the AJT Mining, an inactive mining company.
Both companies trace their origins to late 19th Century.
"AEL&P's 120-year culture of service and community partnership is a great long-term fit with Avista Corp.," Scott Morris, Avista Corp. chairman, president and chief executive officer said in a statement. "We have found the company to have similar cultural values and focus on providing safe, reliable service to its customers that Avista has held dear for nearly 125 years. This agreement reflects Avista's strategy to expand and diversify energy assets."
— Greg Stiles