What is the status of Chugach buying Municipal Light & Power? Voters authorized the Municipality of Anchorage (MOA) to sell ML&P to Chugach in the April 3, 2018 election with a vote of 65 percent in favor of the sale. Chugach and the MOA negotiated final sales agreements and associated documents which were approved by the Chugach Board of Directors subject to certain conditions being met. Following those negotiations, the sale of ML&P was approved by the Anchorage Assembly on Dec. 4, 2018. The Chugach Board of Directors gave its final approval on December 19, 2018.
What comes next? Chugach and the MOA will submit a request to the Regulatory Commission of Alaska in first quarter 2019 for approval of the transaction. The RCA has six months to approve aspects of the final deal including cost recovery by Chugach and amendments to Chugach’s and ML&P’s certificates of public convenience and necessity.
It was reported before the April vote that this is a one-billion-dollar deal. Is that the final sales price?
The ballot language said Chugach would pay a competitive value of approximately $1 billion for the acquisition of ML&P, subject to adjustment during the due diligence process. The final negotiated sales price is $1,009,600,000.
Is the final purchase agreement available to the public? The final sales agreement and associated documents are posted on the What’s New section of this website.
When will everything be final? Assuming receipt of RCA approval, the current estimate is the transaction could close in 4Q 2019 or 1Q 2020.
When will ML&P customers become Chugach customers? ML&P customers will become Chugach members/customers after the deal closes, which is currently estimated to occur sometime in 4Q 2019 or 1Q 2020.
When will ML&P employees become Chugach employees? ML&P employees will become Chugach employees after the deal closes, which is currently estimated to occur sometime in 4Q 2019 or 1Q 2020.
What is going to happen to all buildings currently being utilized by ML&P? As part of the sales agreement, Chugach is buying most of the properties currently owned by MOA and managed by ML&P.
Will Chugach do the same level of community activity sponsorship as ML&P? As a member-owned cooperative, Chugach values supporting community activities and continues to strengthen its community connections. Chugach will continue being active and supportive in the community. The acquisition of ML&P will not change Chugach’s commitments.
Are rates going up to pay for the transaction? Chugach has affirmed, and it was part of the ballot language, that base rates will not increase as a result of the transaction. In the long-term, elimination of duplication and taking advantage of economies of scale will allow Chugach to honor that commitment.
Is Chugach sticking to its commitment of no layoffs as a result of the sale? Yes. There will be no layoffs of Chugach or ML&P employees as a result of the transaction. Once the deal closes, the number of positions will be adjusted over time through attrition.