MARQUETTE - Integrys Energy Group Inc. announced Monday it will sell 100 percent of its stock in the Upper Peninsula Power Co. to the infrastructure equity investment fund Balfour Beatty Infrastructure Partners.
"We are confident BBIP will be committed to UPPCO's customers, employees and the Upper Peninsula," said Charles A. Schrock, Integrys chairman and chief executive officer, in a news release.
Under terms of the agreement, the purchase price is about $298.8 million for UPPCO's electricity distribution operations, excluding its American Transmission Co. holdings.
The Hoist Dam in Marquette County is one of a half-dozen Upper Peninsula Power Co. generation facilities in the region. The
company provides electricity to 52,000
residential, commercial and industrial
customers in the U.P. (Journal file photo)
According to the news release, BBIP approached Integrys about the sale early last year.
"After lengthy discussions, it became clear that an agreement might be reached that was in the best interest of both parties," the release stated.
For UPPCO customers, no changes are anticipated.
"The acquisition of UPPCO is a landmark transaction for BBIP. It fits well with our strategy of making long-term investments in high-quality, core infrastructure assets in the utility, energy and transport sectors," said Rob Gregor, a managing partner commenting for BBIP. "For UPPCO, its customers and stakeholders, it will be business as usual. We will maintain the company's Michigan headquarters and, as long-term investors, we are committed to maintaining safe and reliable customer service and investing in the company and the communities UPPCO serves."
Schrock said the transaction is consistent with the company's asset management strategy.
"The proceeds will substantially reduce the need to issue new equity to fund generation and infrastructure requirements at our other regulations facilities," Schrock said.
Jeff Neil, BBIP head of its North American unit, said the fund is "committed to providing UPPCO with the capital necessary to maintain and improve its existing delivery infrastructure."
UPPCO is a regulated electric utility business providing distribution and power supply service to about 52,000 residential, commercial and industrial customers in the U.P. The company was formed through the merger of three small utilities in 1947 and was acquired by Integrys in 1998.
BBIP is an infrastructure equity investment fund, focusing on investments in energy, utilities and transport infrastructure in the U.S., Canada and Europe. The fund has offices in New York and London.
For more information about BBIP, visit www.balfourbeatty.com.
John Pepin can be reached at 906-228-2500, ext. 206.