Hawaii’s top utility regulator said Friday that the Public Utilities Commission wouldn’t make a decision on NextEra Energy Inc.’s $2.6 billion proposed takeover of Hawaiian Electric Industries Inc. by the Friday deadline the companies had set for their merger pact.
Hawaii Public Utilities Commission Chair Randy Iwase said by phone that he hoped the three-member panel would issue a ruling on the deal this month. The board is reviewing an internal staff recommendation on the transaction, he said. He declined to comment on what the staff recommended.
The takeover has drawn intense opposition by local officials, including Hawaii Governor David Ige who has questioned NextEra’s commitment to Hawaii’s goal of sourcing all of its power from renewable resources by 2045. More than 18 months have passed since the companies announced their merger, casting doubts on whether it’ll actually close.
NextEra and Hawaiian Electric agreed to June 3 as a deadline after which either company could walk away from the deal. If NextEra walks away, it would have to pay Hawaiian Electric about $95 million, Hawaiian Electric executives told investors May 4.
Company deadline
“That deadline does not apply to us,” Iwase said. “It’s not even something in our psyche. That’s a deadline between the two parties and it doesn’t affect us at all.”
Hawaiian Electric Chief Executive Officer Constance Lau said on the investor call last month that the merger agreement can “continue on” even if the June 3 deadline comes and goes. NextEra has said it supports the state’s clean energy goals and views Hawaii as a testing ground for a transition from fossil fuels to power generated from the sun and wind.
‘Long Odds’
“The merger faces long odds against deep-seated local opposition in the Aloha state,” Peter Cohn, an analyst with Height Securities LLC, wrote in a research note on Friday. “We don’t see a path for the NextEra-Hawaiian Electric merger coming to fruition.”
NextEra and Hawaiian Electric declined Friday to comment.
Iwase said commissioners were reviewing hundreds of thousands of pages of documents including briefs and transcripts of testimony. “We are still looking at it,” he said.
If the commission doesn’t make a final decision Friday, Hawaiian Electric and NextEra may decide not to move forward with the deal, said Stacy Nemeroff, an analyst for Bloomberg Intelligence.
Hawaiian Electric rose 1.1 percent to $33.31 at the close in New York. NextEra added 1.7 percent to $121. 80.
—With assistance from Jim Polson.