Hydro One shares go on sale next week at $20.50

The Ontario government will raise upwards of $1.66 billion with the sale of part of Hydro One, the company has announced in a securities filing.

Shares will be priced at $20.50 per common share on the Toronto Stock Exchange, within the price range announced two months ago.

The environment for public offerings has deteriorated since Ontario announced its plans to take the utility public last year, so the pricing reflects confidence that the stock will be snapped up by investors.

There will be 81.1 million shares available, with 40 per cent of the offering set aside for retail investors.

Another 8.15 million shares could be released if the underwriters decide the conditions are right. The province would then have received gross proceeds of $1.83 billion.

Initially the province plans to retain 86.4 per cent of the issued and outstanding common shares.

It could reduce its stake to as little as 40 per cent over a period of years.

The stock sale begins next Thursday and Hydro One could begin trading on Nov. 5.

Hydro One is Ontario'slargest electrical transmission and distribution utility with approximately$23 billionin assets and 2014 revenues of over$6 billion.

Ontario Energy Minister Bob Chiarelli has promised the funds raised will be put to infrastructure spending, including transit, bridges and highways.

But Stephen LeClair, the new financial accountability officer, has warned the province will be in even "worse" shape financially after selling off Hydro One, as the company brings in $700 million a year for the government.