Utility merger sought
In April, the two public power distributors — Vaughan and Markham own PowerStream and Barrie owns Barrie Hydro — entered into a courtship to determine whether a merger would be beneficial.
The recent report, prepared by KPMG, concluded multimillion-dollar annual savings could be achieved through combining assets and achieving greater economies of scale.
With the report in hand, negotiators hammered out the details of a draft merger agreement, which establishes the framework for what would be the province’s second largest local power company.
The merger agreement now goes to the two utilities’ boards of directors. Public information sessions will be held before any final decisions are made.
“If approved, a merger of Barrie Hydro and PowerStream will help to establish a strong regional electricity distribution utility which will be better able to serve its customers and meet the challenges of an ever-changing industry,” Barrie Hydro president and CEO Mark Henderson said in a statement.
Under the draft agreement, the City of Vaughan would own 44–46 percent of the merged utility, the Town of Markham would own 34–36 percent and the City of Barrie would control 18–21 percent.
The combined utility would be headquartered in Vaughan and maintain at least two operation and administration centres, including one in Barrie.
A new 13-member board of directors would be named, with Vaughan controlling six seats, Markham four and Barrie three.
Both Barrie Hydro and PowerStream say labour concerns have been dealt with and no union workers or management staff will lose their jobs as a direct result of the proposed merger.
PowerStream is Ontario’s third largest electricity distribution company with more than 240,000 customers in Vaughan, Markham, Richmond Hill and Aurora. Barrie Hydro is the province’s 12th largest distribution utility with more than 70,000 customers.
Vaughan Today In print: August 29, 2008, page 1 Online: August 28, 2008 [link]