ScottishPower-Pacificorp deal hits problems
UK multi-utility, Scottish-Power`s £4.2bn ($6.75bn) acquisition of US utility Pacificorp has run into opposition in Utah and Oregon. Pacificorp, based in Portland, Oregon, does about 70 per cent of its business in the two states. The opposition may not be enough to kill the deal but could cause significant delays.
In Oregon, consumer groups are getting ready to oppose the transaction, the first major foreign acquisition of a US electric utility. The companies may come under pressure to reduce electricity rates in return for regulatory blessing.
In Utah, state governor Mike Leavitt has been critical of the deal, and two bills that would give the legislature the final say have been introduced. The bills call for legislative approval – and in one case the governor`s signature – before the acquisition can be completed.
The US government has said there are no anti-trust obstacles to the deal but it still requires regulatory approval from the Federal Energy Regulatory Commission (FERC) and the regulatory commissions in Utah and the four other states in which Pacificorp operates. A final decision is expected by the end of the year.