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Monday, September 29, 2014

Fortis to explore sale, spin-out of hotels and other real estate assets, (TSE: FTS.TO)

Fortis Inc said on Friday it has retained advisors to explore a sale, or spin-out of its hotel and commercial real estate business now operated and controlled by its wholly owned subsidiary Fortis Properties Corp. The St John's Newfoundland and Labrador-based utility firm said Fortis Properties operates some 23 hotels in eight Canadian provinces, including properties for brands such as the Sheraton, Delta, Hilton, Holiday Inn, Ramada and Best Western.It also controls some 2.8 million square feet of commercial and retail real estate, primarily in Atlantic Canada.The assets generated revenues of about $250 million and had earnings before interest, taxes, depreciation and amortization of about $80 million in 2013.The review of Fortis Properties will explore various options for the non-utility subsidiary, the company said, including but not limited to "a sale of all or a portion of the assets, a sale of shares of Fortis Properties or an initial public offering."

Fortis Inc. (Fortis) is an investor-owned gas and electric distribution utility in Canada. Shares of FTS traded higher by 1.29% or $0.44/share to $34.56. In the past year, the shares have traded as low as $29.51 and as high as $34.72. On average, 568816 shares of FTS.TO exchange hands on a given day and today's volume is recorded at 642606.