IPO plan for Ontario's Hydro One in works -report

Tue Mar 10, 2015 8:43am EDT
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TORONTO, March 10 (Reuters) - Ontario's Liberal government is crafting a plan to sell shares in provincially owned electrical utility Hydro One, the Globe and Mail reported on Tuesday.

The story, which cited unnamed government and industry sources, said under the proposal the province would float 10 to 15 per cent of Hydro One in an initial public offering, and possibly follow with additional stock sales that would further reduce its stake.

Investment bankers have told the government Hydro One's enterprise value - the combined value of its debt and equity - is roughly C$15-billion ($11.87 billion) to C$16-billion, which means the IPO could raise upward of C$1-billion, the article said.

The IPO would represent a chance to earn tens of millions of dollars in fees for investment bankers, it noted, as well as helping the province reduce its budget deficit or invest in infrastructure.

($1 = 1.2637 Canadian dollars) (Reporting by Jeffrey Hodgson Editing by W Simon)