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Electric utilities

ScottishPower and PacifiCorp Announce £12 Billion Merger

Strategic Insights

— 1 min read

The merger between ScottishPower and PacifiCorp, a US-based electricity group, is set to create a new £12 billion strong utility company with a headquarters in Glasgow. The deal, which values PacifiCorp at £4.7 billion, will result in a minority 32% stake for PacifiCorp shareholders in the new group. ScottishPower will retain its name and UK staff of 15,000 will not face job cuts, although cost savings from the merger are expected to lead to redundancies in the US. The new company will benefit from the management skills demonstrated in ScottishPower's UK business and provide a platform for growth in the US.

Key Takeaways:

  • The merger between ScottishPower and PacifiCorp will create a new £12 billion strong utility company with a headquarters in Glasgow.
  • The deal values PacifiCorp at £4.7 billion, with PacifiCorp shareholders taking a minority 32% stake in the new group.
  • ScottishPower will retain its name and UK staff of 15,000 will not face job cuts.
  • The new company will benefit from the management skills demonstrated in ScottishPower's UK business.
  • Ian Robinson will continue as chief executive, and Murray Stuart, chairman of ScottishPower, will remain chairman of the group.
  • Ian Russell will become deputy chief executive and finance director.
  • The merger is expected to lead to redundancies in the US as cost savings are made next autumn.

Statistics:

  • The new company will have a value of £12 billion.
  • PacifiCorp will account for 32% of the new group's ownership.
  • The UK side of the link-up will be the dominant partner.
  • ScottishPower will retain 68% ownership of the new group.
  • The merger is expected to lead to £4.7 billion in investments.
  • £500 million will be distributed to ScottishPower investors through a share buyback, conditional on the merger going ahead.

Sources:

  • "ScottishPower and PacifiCorp Announce Plans for Merger" (The Times, cited)
  • "ScottishPower to merge with US power company PacifiCorp" (BBC News, cited)
  • "PacifiCorp and ScottishPower Announce Plans for Merger" (Investor Relations, cited)

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