Chiefs laud Hydro One sale

By Michael-Allan Marion, Brantford Expositor

The Ontario government’s completion of the sale of nearly 14.4 million common shares of Hydro One Ltd. stock to a corporation held by 129 First Nations represents another step in the province’s reconciliation with Indigenous peoples, says Six Nations elected Chief Ava Hill.

“This is a benefit for future generations. It’s another sign of a new relationship in this era of reconciliation,” Hill said in an interview Thursday.

The government completed on Dec. 29 the promised sale of shares representing 2.4 per cent of the outstanding common shares to OFN Power Holdings LP, a limited partnership wholly-owned by Ontario First Nations Sovereign Wealth LP, which is in turn owned by 129 First Nations in Ontario at a purchase price of $18 per share for a little more than $259 million.

The transaction was quietly announced Wednesday in a news release from the Ministry of Energy.

“The transaction fulfills the province’s commitment in its agreement-in-principle with the Chiefs-in-Assembly on behalf of the First Nations in Ontario, which was previously announced on July 12, 2016, the ministry’s statement says.

“This transaction demonstrates the goodwill envisioned by the political accord to promote stronger economic relations and is one of the many steps in Ontario’s journey of healing and reconciliation with Indigenous peoples.

“It will provide meaningful opportunities to First Nations for collective wealth creation and to advance economic development initiatives.”

The government’s initiative is designed to broaden the ownership base of Hydro One. The purchase is financed through a 25-year term loan from the province with a principal amount of $259 million. The interest rate for the loan is at the province’s borrowing rate, plus 15 basis points.

The shares sold in the transaction have been pledged as security for the term loan.

The annual dividends from the shares will be shared by the First Nations partners in the corporation.

Six Nations is one of the partners. The Mississaugas of the New Credit First Nation did not sign onto the deal.

The province has also provided seed capital of about $29 million in cash to a new investment fund wholly-owned by Ontario First Nations Sovereign Wealth.

The annual dividends from the shares will be shared by the First Nations partners in the corporation.

The announcement was greeted with enthusiasm by several chiefs, including Hill, who advised that the sale is meant to provide dividend income and economic ownership in the long term.

“We won’t see revenue for at least five years, but we have to think of our future generations,” she said.

“We have smart young people coming up behind us who will know what to do with the income when the time comes.”

Ontario Regional Chief Isadore Day with the Chiefs of Ontario said he’s “quite thrilled” with the deal.

“It allows us to have a seat at the table with Hydro One. We negotiated a low-interest loan from the Ontario government that did not see First Nations having to contribute anything,” he said.

“This is an opportunity of long-term investment.”