Simpson Thacher Represents ITC Holdings in Proposed Reverse Morris Trust Transaction with Entergy Corporation
12.05.11
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Simpson Thacher is representing independent electric transmission company ITC Holdings Corp. in its agreement to acquire the electric transmission business of Entergy Corporation, an integrated utility, in an all-stock, Reverse Morris Trust transaction, resulting in Entergy shareholders holding 50.1% of the combined company and existing ITC shareholders owning the remaining 49.9%. In connection with the transaction, Entergy will issue nearly $1.78 billion in new debt, which will be assumed by ITC in the merger. Prior to the merger, ITC plans to undertake a $700 million recapitalization, currently expected to be in the form of a one-time special dividend. Completion of the transaction is expected in 2013 subject to the satisfaction of certain closing conditions, including the necessary approvals of Entergy’s retail regulators, the Federal Energy Regulatory Commission and ITC’s shareholders.
Following the completion of the transaction, ITC will become one of the largest electric transmission companies in the U.S., with an expected rate base of approximately $7.1 billion by year-end 2013 and over 30,000 miles of transmission lines, spanning from the Great Lakes to the Gulf Coast.
The Simpson Thacher team includes: Andrew Smith, Rhett Van Syoc, Viktor Sapezhnikov, Jona Lundborg and Kyle Scherer (M&A); Nancy Mehlman, Noah Beck, Jonathan Talansky and Anthony Minervini (Tax); Greg Grogan, Jennifer Wolff and Doug Tang (Executive Compensation and Employee Benefits); Rise Norman and Benjamin Wells (Capital Markets); James Cross and Christian Fischer (Credit); Lori Lesser and Mindy Lok (Intellectual Property); Adeeb Fadil and Noreen Lavan (Environmental); Elisa Alcabes (Insurance); and Krista McManus (Real Estate).