A Scottish company's merger with PacifiCorp does not mean Utahns should brace for a British invasion.
In fact, a ScottishPower official who will become chief executive officer of Utah Power's parent company if the deal goes through said Utahns probably will not notice the ownership change at first."Practically, you're not going to send 10,000 Scots to the United States. I don't think Salt Lake City is ready for that," joked Alan Richardson, managing director of Power Systems at ScottishPower, after the proposed $7.9 billion merger was announced Monday.
Richardson, 52, is responsible for the transmission and distribution of electricity to more than 3 million ScottishPower customers in England, Scotland and Wales.
The Scottish company was privatized in the early 1990s, Richardson said, and has since grown into a powerful multi-utility in the United Kingdom. It acquired Manweb, a regional electricity company, in 1995, and it took over Southern Water in 1996.
"We figured that the right strategy was to be low-cost, high customer service and then move into other utilities, which we did, very, very successfully," Richardson said. "We always had the plan that, if you're really good at this, you can actually apply your skills abroad."
If the merger gains all of the necessary regulatory approvals and closes in late 1999, as planned, the new ScottishPower will be a strong utility player in the western United States, Richardson said.
"The whole issue is using the best practices between the companies," he said. "We've got some good practices in Britain, and we'll send a few people to transfer them. Some will go the other way." But Utah Gov. Mike Leavitt said Monday that he has a "rather substantial concern" about the merger.
"I have questions as to how this could be beneficial or why it would be beneficial to Utah ratepayers," Leavitt said. "When Utah Power & Light and PacifiCorp merged (in 1989), it was clear . . . that Utah ratepayers would be gaining access to low-cost hydroelectric power, and therefore I thought that the merger made sense.
"Turning control of our power in the state to a company headquartered in Scotland has the potential, in my judgment, to disadvantage the state substantially."
Richardson said the new company will continue to play a part in Utah's communities. The merger is not about "turning the world upside down," he said, and he expects Utahns to see some positive changes within a few years.
"The growth rate (in Utah) is twice what it is here in Oregon, and some interesting things are happening, like the Winter Olympics," Richardson said from PacifiCorp's Portland offices. "I think the kind of businesses that are setting up in Utah make for interesting opportunities for an electric utility. Our thrust will be to work to serve those customers with great distinction."
Leavitt said he looks forward to learning more about the proposed merger, but his concerns remain.
"I've had conversations with the governors of Wyoming and Oregon, and they indicate to me they share my concerns," he said. "We'll have more discussions in the next couple of days to determine what course would be best for us to follow."
As for longtime shareholders, Richardson said he wanted to assure them that ScottishPower is a "fine company with good values."
"They've got something now, and they've got a promise of something quite valuable tomorrow," he said.
Toby Levitt, president of Albion Management Group in Salt Lake City, said he received his first Utah Power stock as a child in the 1960s. His father gave him the stock, Levitt said, because he "never turned the lights off."
Levitt has bought and sold shares in Utah Power several times over the years. He owns some of the company's stock now, he said, and he recently gave some to his children, using the same rationale his father used years ago.
"I think people liked Utah Power & Light," Levitt said. "I think they felt it did a good job. . . . And a lot of Utah stockholders, once they get a stock, they tend to never sell it."
He said ScottishPower has a reputation as a well-run company. And he is not concerned about a foreign company owning his electrical utility, because U.S. companies have been purchasing foreign operations for years.
"If they do a better job managing PacifiCorp's assets, it's fine with me," Levitt said.