Acquisition of UIL (Tables)

9 Months Ended

Sep. 30, 2016

Summary of Fair Value of Purchase Consideration

The fair value of AVANGRID common stock issued to the UIL shareowners in the business combination represents the purchase consideration in the business combination, which was computed as follows:

	(millions, except share and unit data)
Common shares⁽¹⁾		56,629,377
Price per share of UIL common stock as of the acquisition date	$	50.10
Subtotal value of common shares	$	2,837
Restricted stock units⁽²⁾		476,198
Other shares⁽³⁾		12,999
Equity exchange factor		1.2806
Total restricted and other shares⁽³⁾ after applying an equity exchange factor		626,473
Price per share used ⁽⁵⁾	$	39.60
Subtotal value of restricted and other shares	$	25
Total shares of AVANGRID common stock issued to UIL shareowners (including held in trust as Treasury Stock)		57,255,850
Performance shares⁽⁴⁾		211,904
Equity exchange factor		1.2806
Total performance shares after applying an equity exchange factor		271,368
Price per share used ⁽⁵⁾	$	39.60
Subtotal value of performance shares	$	11
Total consideration	$	2,873

(1)	Based on UIL’s common shares outstanding on December 16, 2015.

(2)	Based on UIL’s shares of vested restricted stock.

(3)	Based on UIL’s restricted shares that vested upon the change in control.

(4)	Based on UIL’s vested performance shares award.

(5)

Based on the closing share price of UIL common stock on December 16, 2015 less the cash component of $10.50, which is not applicable to restricted shares (other than those UIL restricted shares that vest by their terms upon the consummation of the acquisition), performance shares and other awards under the UIL 2008 Stock and Incentive Compensation Plan and the UIL Deferred Compensation Plan.

Summary of Components of Estimated Consideration Transferred

The following is a summary of the components of the consideration transferred to UIL’s shareowners:

	(millions, except share data)
Cash ($10.50 x number of UIL common shares outstanding at the acquisition date - 56,629,377)	$	595
Equity		2,278
Total consideration	$	2,873

Schedule of Unaudited Pro Forma Results

Accordingly, these unaudited pro forma results are presented for informational purpose only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the periods presented, nor are they indicative of future results of operations:

	Three Months Ended		Nine Months Ended
	September 30, 2015
	(millions)
Revenue	$	1,378	$	4,440
Net income	$	76	$	279

Summary of Preliminary Allocation of Purchase Price

The following is a summary of the preliminary allocation of the purchase price as of the acquisition date:

	(millions)
Current assets, including cash of $48 million	$	500
Other investments		114
Property, plant and equipment, net		3,552
Regulatory assets		966
Other assets		52
Current liabilities		(493	)
Regulatory liabilities		(493	)
Non-current debt		(1,878	)
Other liabilities		(1,201	)
Total net assets acquired at fair value		1,119
Goodwill – consideration transferred in excess of fair value assigned		1,754
Total estimated consideration	$	2,873