Money Hydro One shares down after Ontario government says CEO, board out

20:56  12 july  2018
20:56  12 july  2018 Source:   cbc.ca

Hydro One board resigns, CEO retires

  Hydro One board resigns, CEO retires Premier Doug Ford says he has made good on a key campaign promise, announcing the immediate retirement of the CEO of Hydro One and the resignation of the utility's entire board of directors.Ford, who promised that if he was elected he would fire Hydro One CEO Mayo Schmidt, dubbing him the "Six-Million-Dollar Man" during the spring election campaign, hailed it as a "great day" for the province.

The entire board of Hydro One Ltd. says it is resigning and chief executive officer Mayo Schmidt has announced he is retiring, succumbing to pressure from new Ontario Premier Doug Ford The Ontario government owns 47 per cent of Hydro One and has the ability to force out the board if it wants to.

Shortly after Ford's remarks, Tory energy critic Todd Smith acknowledged that the Ontario government does not have the direct ability to dismiss the Hydro One CEO . The government has put a process in place that allows it to control or replace the company's board of directors

a person wearing a suit and tie: Hydro One's CEO Mayo Schmidt has retired as part of an agreement between the Ontario government and the utility company.© John Woods/Canadian Press Hydro One's CEO Mayo Schmidt has retired as part of an agreement between the Ontario government and the utility company.

Hydro One Ltd. shares slid Thursday with some analysts sounding warnings of greater uncertainty after the new Ontario government announced the retirement of the electrical utility's chief executive and the replacement of its board of directors.

After sagging by almost eight per cent in early trading on the Toronto Stock Exchange, shares of the company were later down four per cent, or 81 cents, at $19.36 as of 11:42 a.m. ET.

On Wednesday, after stock markets had closed for the day, Ontario Premier Doug Ford announced the immediate retirement of Hydro One CEO Mayo Schmidt. He leaves with a $400,000 payout in lieu of post-retirement benefits and allowances, Hydro One said.

Doug Ford misled voters on Hydro One

  Doug Ford misled voters on Hydro One Premier Doug Ford may not have outright lied this week about the cost of fulfilling his election promise to get rid of Hydro One CEO Mayo Schmidt. But he certainly grossly misled taxpayers when he crowed that the payout to Schmidt for stepping down “was zero … absolutely zero.”In fact, Schmidt is likely to end up with an amount closer to $9 million, mostly in stock options, not the mere $400,000 that Ford claimed he received as a retirement severance payment. And that doesn’t include the $4.

Ontario PC Leader Doug Ford renews attack on Hydro One CEO and board . Analysis. Voters think privatization drives up hydro bills, and that Wynne government wins in Hydro One privatization appeals case. Hydro One sale will mean long-term costs to the province, says financial watchdog.

Ontario . Key people. Mayo Schmidt President & CEO . David F. Denison Chair of the Board . earmarked to pay down Hydro One 's .5 billion debt.[20]. The balance of the revenue from the Hydro One sale would help meet the targets laid out by the provincial Liberal government in its April 2015

During the recent provincial election campaign, Ford vowed to fire Schmidt, who earned $6.2 million last year.

Paul Dobson, Hydro One's chief financial officer, will serve as acting CEO until a new top executive is selected.

Ford also said the entire board of directors of the utility would resign. Hydro One said a new board — four members of which will be nominated by the province — will select the company's next CEO, and the province will be consulted on the next leader's compensation.

A new board is expected to be formed by mid-August.

The provincial government is the largest single investor in Hydro One, holding a 47 per cent stake. The company was partly privatized by the former Liberal government in 2015.

In response to the government's move to supplant the utility's board and CEO, some analysts cautioned investors on raised political or regulatory risks.

Doug Ford fires privatization czar, chief investment officer, chief scientist

  Doug Ford fires privatization czar, chief investment officer, chief scientist Doug Ford fires privatization czar, chief investment officer, chief scientist , and removed Ed Clark as the premier’s business advisor in a post-election purge.Sources told the Star that Ford’s newly elected Progressive Conservative government ended Allan O’Dette’s brief tenure as the province’s first chief investment officer at cabinet on Friday.O’Dette, former president and CEO of the Ontario Chamber of Commerce, had been appointed by former Liberal premier Kathleen Wynne in March 2017 to lead the Ontario Investment Office.

Smith says the Ontario gov still has the right to fire Hydro One board . What about their contracts? Pay them out ? We will not engage in politics,' Hydro One says . A Hydro One spokesperson said the amount customers pay to compensate the CEO 's salary is the same as before privatization — two

ETFs Up and Down . ETFs Market Leaders. A spokeswoman for Hydro One said that the company’s board would be responding to Mr. Ford on Friday. Hydro One board increases price tag for Ontario government intervention by raising CEO severance provisions.

Analyst Jeremy Rosenfield of iA Securities cut his rating on Hydro One shares to hold from buy, and reduced his 12-month price target for the stock to $24 from $26.

Rosenfield said the stock is still a defensive investment supported by stable earnings and cash flows, good earnings growth and healthy dividend.

However, he said in a research note that "the heightened potential for further political interference in the province's electricity market and regulated utility framework represent key risk factors that are likely to outweigh Hydro One's fundamentals over the near term."

Potential challenge to find new CEO

Laurentian Bank Securities analyst Mona Nazir said in a research note that the magnitude of change all at once was "surprising but not shocking."

She said the agreement that will see Hydro One consult with the provincial government on matters involving executive pay could have an impact on the hiring of a new CEO for the utility.

As the share price falls, retiring Hydro One CEO to get millions

  As the share price falls, retiring Hydro One CEO to get millions As the share price falls, retiring Hydro One CEO to get millionsThanks to his stock options, the ousted head of Hydro One will walk away with close to the $10.7 million he would have received in severance — far more than a $400,000 retirement payout Premier Doug Ford touted as a victory for ratepayers.

Hydro One CEO Mayo Schmidt makes almost .5 million a year in salary and bonuses. On Wednesday, Ontario PC Leader Patrick Brown said if elected, he would clamp down on salaries In a statement to the Star, Energy Minister Glenn Thibeault said the “ government recognizes that every

Ontario Liberal's premier says it's unacceptable that Hydro One 's board decided to give themselves pay increases and that's why her government pushed for a review of the utility's compensation package. CEO says the electricity company has become a 'lightning rod' for criticism.

"Given the government's open and public criticism of the company and a potential ceiling on compensation, it may be challenging to attract top talent to the position," she wrote.

Laurentian cut its rating on the Hydro One to hold and reduced its price target to $21 from $24.

Analysts at CIBC World Markets said investors face an uncertain future.

"In particular, we are are concerned about the government meddling in with [power] rates," wrote Robert Catellier and Archit Kshetrapal in a research note, adding they believe the new provincial government is aiming for a 12 per cent reduction in customers' power bills.

CIBC reduced its price target on Hydro One's shares to $20.50 from its previous target of $24.

Ford blames Ottawa for illegal border crossers .
TORONTO - The Ontario government says Ottawa is to blame for a housing crisis caused by people crossing the border illegally and should pay all the costs. A spokesman for Premier Doug Ford said Thursday the federal government has encouraged people to cross into Canada illegally and continues to usher people across the U.S.-Quebec border into Ontario. "This has resulted in a housing crisis and threats to the services that Ontario families depend on," Simon Jefferies said in a statement."This mess was 100 per cent the result of the federal government, and the federal government should foot 100 per cent of the bills.

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