Rather than facing an out-right denial, New Haven utility parent UIL Holdings on Tuesday withdrew its application for Connecticut regulators to approve the company’s proposed $3 billion acquisition by Spain utility giant Iberdrola.
The move gives UIL and Iberdrola the opportunity to start the regulatory proceeding over from scratch, although it significantly delays their plans to complete the transaction by the end of the year. The new company would have control over Connecticut utilities United Illuminating, Connecticut Natural Gas and Southern Connecticut Gas.
The Connecticut Public Utilities Regulatory Authority already had indicated in its draft decision last week it planned to deny the proposed $3 billion takeover on the grounds that there are no guarantees or indication it will be beneficial for ratepayers. UIL and Iberdrola had asked for an extension of the case so that it could adequately prove the transaction’s worth, but PURA quickly denied that.
Instead, by withdrawing, UIL and Iberdrola have the opportunity to make their case before PURA anew, with better knowledge of what the agency wants before granting its approval.
The two utility companies had planned on completing the acquisition by the end of the year. However, starting the Connecticut regulatory process over again will slow that down, as it is subject to a 120-day waiting period, and the first case took nearly six months before getting to a draft decision.
UIL and Iberdrola did not indicate when they would file the new PURA application.
UIL actually is merging with the American subsidiary of the Spain energy giant, Iberdrola USA, which is based in Maine. The new company, still called Iberdrola USA, will have utility companies in Connecticut, Maine, Massachusetts and New York.
In addition to Connecticut, the companies still must secure regulatory approvals from Massachusetts, the U .S. Securities & Exchange Commission, the Federal Communications Commission and the Committee on Foreign Investments in the U.S.
