ScottishPower: Subsidiaries
ScottishPower is affiliated (or has been) with the following subsidiaries:
Contents
Manweb
Scottish Power was the larger of the two Scottish energy companies and benefited from being both a generator and supplier of power. In 1995 it acquired the English Regional Electricity Company Manweb, which supplied Merseyside and North Wales. In 1996 the company diversified into the water supply business with the purchase of Southern Water (which was sold again in 2002). When the supply of energy into British homes was opened up to competition, ScottishPower entered this market, stealing share from the previous gas supply monopoly British Gas and also building new market share in England and Wales.
Thus
Scottish Power established the telecommunications company, Thus (originally known as ScottishTelecom). This was floated on the London Stock Exchange with Scottish Power retaining a 20% stake, until 2002 when it sold its interest.
Pacificorp
In 2000, Scottish Power completed the acquisition of Pacificorp which supplies electricity in the western United States, where it operates as Pacific Power (in Oregon, Wyoming, Washington, and California), and as Utah Power (in Idaho and Utah). In May 2005, Scottish Power announced that it had agreed to sell Pacificorp to MidAmerican Energy Holdings Company for $5.1 billion in cash and $4.3 billion in debt and preferred stock. The successful completion of the deal was announced on 21 March 2006, after securing regulatory approvals.
PPM Energy
In 2001, PacifiCorp Power Marketing, Inc. moved from being a subsidiary of PacifiCorp to being an affiliate to PacifiCorp. It was announced in 2002 that Scottish Power's competitive US energy business would change its name to PPM Energy, Inc. on January 15, 2003.
CEO Terry Hudgens said "Our business has grown beyond 'power' into gas storage and well beyond 'power marketing'. As a result, we realized that our old name-PacifiCorp Power Marketing-is too narrow a fit for our expanded capabilities. The new logo reinforces the fact that PPM remains a member of the ScottishPower group of companies. We'll still be the same people providing the same great level of services and even more products - just with a new name."
PPM Energy remained the same organization with the same contracts and the same underlying support. The PPM name and logo emphasized their ties to ScottishPower and its separate and independent status from the regulated utility, PacifiCorp. [3]
Rejected takeover bid from E.ON
In 2005, Scottish Power's chief executive Ian Russell fired four fellow board members. His explanation refered back to late May of that year when the company announced the £5.1 billion sale of its giant US business PacifiCorp to the world-famous entrepreneur Warren Buffet. Since PacifiCorp was responsible for two-thirds of Scottish Power's valuation, the company would become much smaller when the deal went through. The idea of the restructuring was to slim down the group - stripping out the four directors in the process - preparing it for life as a smaller, independent, predominantly UK-based utility. However, Mr. Russell did not mention that the group's smaller size was what had attracted E.ON's attention or that the downsizing was threatening the independence of one of Scotland's biggest companies. To this day, Mr. Russell has yet to publicly link the two events - despite the asking of questions in parliament. Neither did he bring up the £9 million in shares, pension payments and other incentives he could make from a deal. [4] As Scottish Power's shares soared, rumours spread of its German rival, and owner of Powergen, E.ON wanting to buy the company. Now widely seen as vulnerable to a takeover, it was soon revealed that the German energy group were indeed interested in a takeover. However, On November 22, 2005 the board rejected an offer from E.ON of 570 pence a share, which would have valued the group at £10.7 billion. [5]
Takeover from Iberdrola
On November 28, 2006, the board of directors of Scottish Power agreed to a £11.6 billion takeover bid by the Spanish energy firm Iberdrola (Spain's second-largest utility company) to create Europe's third-biggest utility and a world leader in renewable energy. [6] The new group will have installed capacity of 36,600 megawatts (MW), of which over 6,000 MW will be renewable, and its electrical supply points will total 21.4 million. Iberdrola, the hundred-year-old Spanish-based company, is among Europe’s major electrical companies and operates gas and electricity businesses in 28 countries. In addition, it is one of the world leaders in the production of windgenerated power.
Incidently, the Board of Directors of Scottish Power had been advised on this merge by Morgan Stanley who controls approximately 0.1% of the company's capital. [7]
Notes
- ^ PPM Energy company information from PPM EnergyMedia room, "PPM Energy is coming", accessed 17 April 2007.
- ^ Photograph from Wikipedia E.ON accessed 19 April 2007.
- ^ Company restructuring from The Scotsman "Battle to keep ScottishPower in Scotland" Top Stories, accessed 19 April 2007.
- ^ Bid rejection from The Scotsman "ScottishPower rejects E.ON's £10.7bn bid" Energy & Utilities, accessed 2006.
- ^ Photograph from AEM Iberdrola, logo, accessed 16 April 2007.
- ^ Takeover information from CNN.com World Business, "Scot Power agrees $22B Spanish bid", accessed 16 April 2007.
- ^ Takeover information from Iberdrola Press Release, "IBERDROLA REACHES MERGER AGREEMENT WITH SCOTTISHPOWER FOR € 17.2 BILLION", accessed 16 April 2007.
