The Federal Energy Regulatory Commission has conditionally approved the merger between Utah Power & Light Co. and Pacifi-Corp, the utilities said Wednesday.
An order and opinion by the commission was issued Wednesday affirming, modifying and reversing in part an initial order, and conditionally approving the $2 billion merger, the spokeswoman said."We are pleased with the FERC approval. We understand there are some conditions attached, but as of noon today we don't know what they are," UP&L spokesman Dave Mead said.
Added PacifiCorp's Jack Vogel: "We haven't had a chance to look at it, but we are definitely pleased with the approval."
Although Mead did not know specifics of the conditions, he did say that the utility was told conditions generally deal with access by competitors to UP&L's and PacifiCorp's merged transmission systems that would stretch across a seven-state service area.
FERC approval is the final major regulatory hurdle for the merger, which was announced in August last year. The merger would create an $8 billion utility, serving more than 1 million customers in seven Western states. Under the merger, UP&L would become a division of Portland, Ore.-based PacifiCorp, which is also the parent of Pacific Power & Light.
Utah Public Service Commissioner Jim Byrne said the PSC will have to examine the FERC order to see how the conditions will affect UP&L and its Utah customers, then possibly reconsider its approval of the merger. Regulators in Oregon, Washington, California, Idaho, Montana and Wyoming have approved the merger.
An August deadline to seek regulatory approval for the merger was set by directors of both utilities when they announced their proposed marriage last year. But when FERC didn't act within that time frame, the boards extended the deadline to Oct. 31.
Boards of both utilities will meet separately Tuesday to decide whether to proceed with the merger, depending on how the FERC's conditions affect benefits of combining operations, officials said.
Under the agreement, UP&L shareholders will swap their stock for PacifiCorp shares in the deal valued between $1.8 billion and $2.2 billion, depending on the value of PacifiCorp stock - the bottom limit set at $32.25 and the top limit at $38.