By Mike Dunn
PHILADELPHIA (CBS) – Today is the first day the company that wants to purchase PGW has the ability to drop out of the deal. But officials with the firm say they’re staying in, for the time being.
There had been speculation that the firm UIL Holdings could exercise its option to drop out of the PGW purchase because City Council — which has to approve the deal — has not even scheduled a hearing on the matter. But UIL spokesman Michael West says the company will NOT opt out and will wait to see how Council and the state PUC handle it.
“What we are doing is choosing to stay in, for now, hopeful that the City Council process will move forward, and hopeful that we will get a successful conclusion from that, and then attempt to go to the PUC for their approval,” West said.
UIL has offered to buy PGW for nearly $2-billion.
West said the decision to stay in is not related to the heavy investment the firm has already made to buy the city-owned utility.
“I wouldn’t really consider it a purely financial decision. The reason we submitted the bid is because we thought it was a strong and prudent business move,” he said. “So this is something we think will be a benefit and the citizens of Philadelphia.”
And West says the firm is not bothered by the pace of Council’s deliberations.
“Certainly we didn’t think it would be a small or simple process going in, given the fact that its a municipal-owned system.”
The mayor says one-quarter of the $2 billion sale proceeds would be invested into the struggling city worker’s pension fund. Council members say they want to wait on a hearing until a consultant they hired has finished its work.
The consultant is reviewing both the details of the purchase agreement and the larger question of the best use for PGW.