Stockwatch – Fortis Inc. (TSE:FTS, Mkt cap 10.11B, P/E 25.33, Div/yield 0.34/3.78, EPS 1.42, Shares 278.62M) has come good on its promise to sell off its Properties division, announcing that it has signed a $365 million deal with a private investor group for the hotel assets of subsidiary Fortis Properties Corp.
As the Telegram reports, the decision to part with its portfolio of hotel properties was taken in order to ensure focus on its core utilities business.
The St John’s-based firm says the deal with the unnamed private investor group will comprise all 22 hotels across seven Canadian provinces.
The announcement of the transaction, slated to close in the fall, comes shortly after the completion of the sale of Fortis Properties’ commercial real estate portfolio, reported to be worth $430 million.
At the start of the year, Nora Duke, president and CEO of Fortis Properties, outlined the sale of its Properties division, explaining that it only represented around 3% of the overall company.
In its latest statement, Fortis said the hotel transaction is further evidence of the company’s commitment to its North American electric and gas utility business.
“The disposition of these hotel and real estate assets is consistent with the corporation’s focus on its core utility business,” said Fortis president and CEO Barry Perry, in the statement.
“Post closing of the hotel transaction, virtually all of the corporation’s assets will be comprised of regulated utilities and long-term contracted energy infrastructure.”
The list of properties being sold includes the Delta, Holiday Inn and Sheraton hotels in St. John’s, the Mount Peyton Hotel in Grand-Falls Windsor and Greenwood Inn and Suites in Corner Brook.
Fortis Inc. is a Canadian electric and gas utility company based in St. John’s, Newfoundland. Fortis’ regulated utilities account for approximately 90% of total assets. The Company also holds non-regulated hydroelectric generation assets in Canada, Belize and New York. The Company also holds investments in non-regulated generation and non-utility assets.
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