NextEra recently acquired Hawaiian Electric Industries (“HEI”) in a transaction valued at $4.3 billion, subject to Hawaii Public Utilities Commission approval and approval by HEI shareholders. HEI shareholders will receive a 21 percent premium on the share price approximately. Additionally, American Savings Bank, owned by HEI, will be spun off to shareholders and become an independent, publicly traded company. Hawaiian Electric Industries shareholders will receive 0.2413 NextEra Energy shares per HEI share and a one-time cash dividend payment of $0.50 per share. Citigroup Global Markets advised NextEra Energy, and J.P. Morgan Securities advised HEI. NextEra owns and operates about 17 percent of installed U.S. wind capacity, 14 percent of U.S. utility-scale solar, and eight nuclear reactors. As of year-end 2013, NextEra had revenues of approximately $15.1 billion and 13,900 employees in the U.S. and Canada.
As Hawaii’s utility, HEI supplies power to almost half a million customers on Hawaii, Oahu and Maui. Hawaii has the nation’s highest electricity prices and about 75 percent of the island’s power comes from imported oil. The solar industry, generally, and particularly in Hawaii is in a troubled state; however, some suggest that an HEI acquisition might be a good idea. MJ Shiao, GTM Research solar director, comments that HEI “is the living case study for high-penetration PV and the potential benefits and pitfalls of advanced PV integration regulations and technology. It will be interesting to see whether NextEra’s acquisition will influence the ongoing development of requirements in Hawaii, as well as to see how HECO’s experience will translate to [NextEra company] Florida Power & Light, which has seen relatively little distributed solar since Florida’s ARRA-backed incentives ended.”