My sources tell me PowerStream submitted a bid to purchase the town’s share of the Collus-PowerStream utility, late on Friday, December 9. While the amount was not stated, I am told it is a “very fair” bid. This is so far going as I predicted in my earlier post.
PowerStream paid $8 million cash for half the share in 2012 (with another $6.4 million coming through Collus from notes and recapitalization), but since then The Block and town administration gutted the board (twice), joyfully ruined the shared services agreement, and happily took away the water side thus reducing the utility’s revenue considerably. Done over two years of secret conniving behind closed doors.
IT services is hanging by a thread – town hall pulled the plug and secretly contracted (apparently sole-sourced without RFP or RFQ) with a Barrie company to do the work. And council approved Collus buying the remaining hardware so the cord has been almost fully cut. The IT relationship with Collus and the town is likely to be cancelled by January 1.
For many years, the town got exemplary IT service at a hugely discounted cost from Collus. The new contract with the out-of-towners will cost taxpayers tens of thousands more every year, but hey, it’s only money, right? Your money, of course, but what do our Blockheads care about you?
All that’s left is billing for the water side, still done by Collus, but thanks to town administration and our Blockheads, is about to cost you hundreds of thousands of dollars more a year when the share sale goes through.
Given the Block’s active and aggressive devaluation of the utility since the 2012 sale of 50%, I doubt the book value of the utility is more than $5 million now. However, PowerStream may offer more than that if for no other reason than to end the harassment and bullying and get away from the town as quickly as possible.
The deadline for the town to accept or reject the bid is, I believe, Friday, January 6, 2017, just under a month away. And that’s with the sword-of-Damocles shotgun clause hovering over their heads. Not very much time for a council whose term has been showcased by flailing inaction, and gormless dithering to make an actual decision. I bet the Blockheads do what the administration tells them to do, just like they always have.
My sources also suggest that no other Ontario utility submitted a bid by the Dec. 2 deadline. Now that may be mere speculation, but it was bandied about somewhat earlier that Hydro Ottawa had decided not to submit a bid some time ago. Not surprising: any LDC doing its due diligence, investigating the sordid history of the actions of this town administration and this council towards its partner would likely be very wary of doing any business with this nest of vipers. This council and this administration are under investigation by the OEB for unethical and improper actions – who would want a part of that while it remains unresolved?
It may be possible that Epcor – the Edmonton utility corporation – has submitted a bid, but that bid is likely larded with give-away caveats and hidden snares. Epcor was in negotiations to buy half of the Innisfil electrical utility – InnPower – but the deal fell through when someone read in the fine print and discovered that Epcor demanded to get the township’s water and wastewater utility thrown in as well. As was reported in April, the deal wasn’t good news for Innisfil customers but the fallout might be:
…with the death of the EPCOR proposal, Innisfil can explore possible mergers with larger hydro companies such as PowerStream, which could lower rates by as much as 16 per cent.
As the Barrie Examiner noted, it was a very expensive failure for InnPower to mess with Epcor:
InnPower also agreed to reimburse the town $150,000 in legal and transaction expenses, establish an Ontario regional head office at the InnPower building, and pay a “finders’ fee” of up to $3.75 million, after EPCOR has invested $75 million in Innisfil’s infrastructure, an investment likely to take five to 10 years, and expected to involve further partnership with InnServices, the new town corporation established to handle water and wastewater municipal services.
With a reputation for not reading anything and a renowned resistance to learning, The Block would never uncover similar clauses in a deal even if they chose it over others.
There has been no official statement from The Most Secretive Council Ever or their puppet utility board. Expect one soon.
So what next? We’ll have to wait and see. My guess: they’ll accept the offer and slink away with their collective tail between their legs in search of some other public service or facility to destroy.
Collingwood deserves better.