June 27, 2011 / 11:19 PM / 7 years ago

UPDATE 1-CVPS board authorizes discussions with Gaz Metro

* Says Gaz Metro offer likely to lead to superior proposal

* Continues to be bound by terms of deal with Fortis

June 27 (Reuters) - Central Vermont Public Service Corp CV.N said its board of directors authorized discussions with Canada’s Gaz Metro LP, and determined that Gaz Metro’s proposal was likely to lead to an offer that is superior to bid from Fortis Inc (FTS.TO).

Last week, Quebec-based Gaz Metro made a $472 million, unsolicited offer for Central Vermont (CVPS), trumping Fortis $470 million proposal.

However, Vermont-based CVPS said in a statement that it continues to be bound by the terms of its deal with Fortis.

Gaz has been serving the Vermont market for about 25 years, and is looking to build its presence in the northeastern U.S. state. Whereas, Fortis — the largest investor-owned distribution utility in Canada — is looking for a foothold in the U.S. utility market.

Shares of CVPS closed at $35.68 on Monday on the New York Stock Exchange — above the $35.25 a share offered by Gaz Metro. (Reporting by Mihir Dalal in Bangalore)

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