UIL kills deal to purchase PGW
The Conn. company said its decision resulted from City Council inaction.
UIL HOLDINGS, the Connecticut utility company chosen by Mayor Nutter to purchase PGW for nearly $2 billion, has killed its offer indefinitely.
"Unfortunately, there was not enough political will to get this done," said UIL spokesman Michael West.
"Our investment apparently wasn't that attractive to some City Council members in leadership, so we felt that we needed to exit the deal at this time.
"We are disappointed by not having an opportunity to represent the facts of it, and clearly there's no action by Philadelphia City Council to introduce a bill anywhere in the foreseeable future . . . We knew we had a strong case. Unfortunately, it just didn't happen for us in Philadelphia."
UIL signed an Asset Purchase Agreement to buy PGW in March and had the contractual rights to bow out at any time. The deal would have expired automatically Dec. 31.
Nutter, in a prepared statement, said the Council decision was "a big mistake and represents a massive failure of leadership for our city and our citizens . . .
"The citizens of our city, the customers of PGW and our own city workers will feel the negative effects of this terrible indecision for years to come, and ultimately will regret that City Council chose to end a legitimate debate on this issue even before it started."
Proceeds from the $1.86 billion transaction would have gone into the city's beleaguered pension fund, which is missing half of what it needs to be self-sustaining.
Council President Darrell Clarke said in a prepared statement that the company "never had a chance of winning our endorsement."
"It is unfortunate that Mayor Nutter chose to pursue an extremely narrow deal to privatize PGW that ignores opportunities to increase Philadelphia's economic output," Clarke said. "This deal would have resulted in significant job loss among Philadelphians by allowing UIL to lay off employees and to shift jobs away from experienced PGW workers.
"Make no mistake, the failure of this deal is not the fault of UIL Holdings. The lack of sufficient jobs, consumer and safety protections in this deal are a direct result of the Nutter administration's request for proposals, which was limited in scope and issued with no input from City Council."