Two become one: Kenora, Ont. council approves merger with Thunder Bay Hydro

The merger between Thunder Bay Hydro and Kenora Hydro will go ahead as planned after council in Kenora, Ont.  approved the proposed consolidation on Tuesday, Jan. 16.

On Monday night, Thunder Bay city council gave their stamp of approval to consolidate the two electricity utilities in northwestern Ontario as hydro officials claim merging the two companies will benefit customers by ensuring lower electricity rates.

• Thunder Bay city council approves proposed local hydro merger

The two companies have been seeking a merger since 2016 as a report presented to Thunder Bay city councillors on Monday night showed the increasingly complex landscape that has many smaller electrical utilities in Ontario consolidating.

• Thunder Bay, Kenora hydro companies explore potential merger

• Kenora Hydro holds public meeting on possible merger with Thunder Bay Hydro

According to a media release from Kenora Hydro, the Board spent the past 15 months "pursing a potential merger by reviewing financial statements, completing due diligence on each other and identifying benefits for the shareholders and the customers."

Officials said the City of Kenora will own approximately nine per cent of the shares of the new company and Kenora will be entitled to a seat on the new board of directors.

Council in Kenora believe this merger will allow the consolidated company to adapt to the changing industry and increase the economies of scale which will in turn lower costs and reduce the business risk.

Customers and shareholders are expected to benefit through low rates and new services such as outage mapping, according to officials from Kenora Hydro.

Kenora will maintain a local operations centre, according to Tuesday's statements.

Officials said Kenora Hydro staff will transition over to the new entity, while any needed reductions in staff will be primarily done through attrition.