Fortis Inc. Acquisition of CH Energy Group, Inc. Approved by New York State Public Service Commission

  Fortis Inc. Acquisition of CH Energy Group, Inc. Approved by New York State
  Public Service Commission

Business Wire

POUGHKEEPSIE, N.Y. -- June 13, 2013

Fortis Inc. (“Fortis” or the “Corporation”) (TSX:FTS) and CH Energy Group,
Inc. (“CHEnergyGroup”) (NYSE:CHG), the parent company of Central Hudson Gas
& Electric Corporation (“Central Hudson”), announced today that the New York
State Public Service Commission (the“NYSPSC”) has voted to approve the
Corporation’s agreement to acquire CHEnergy Group (the “Acquisition”).
Closing of the Acquisition is expected to occur shortly after receipt, review
and acceptance of the official written order of the NYSPSC.

On February 21, 2012, Fortis and CH Energy Group announced that Fortis had
entered into an agreement to acquire CHEnergy Group for US$65.00 in cash per
share, representing an aggregate purchase price of approximately US$1.5
billion, including the assumption of approximately US$500 million of debt at
closing.

Central Hudson, the main business of CH Energy Group, is a regulated
transmission and distribution utility serving approximately 300,000electric
and 75,000 natural gas customers in eight counties of New York State’s
Mid-Hudson River Valley. As at December 31, 2012, Central Hudson accounted for
approximately 93 percent of CHEnergy Group’s total assets of approximately
US$1.8billion. Central Hudson accounted for approximately 95 percent of
CHEnergy Group’s net income in 2012, excluding the impact of
acquisition-related expenses.

“Central Hudson is a well-run utility whose employees, like those throughout
the Fortis federation of utilities, are committed to serving their customers
and their communities,” saysStanMarshall, President and Chief Executive
Officer of Fortis. “We welcome the employees of Central Hudson to the Fortis
team, and we look forward to their contribution as we continue to meet our
customers’ energy needs safely, reliably and cost effectively,” he said.

“Our new association with Fortis provides substantial and lasting benefits for
our customers, andthe Fortis business model retains Central Hudson as a
standalone company,” saidStevenV.Lant, Chairman of the Board and President
of CHEnergyGroup. “In our capital intensive and increasingly consolidating
industry, becoming a member of the Fortis federation of utilities ensures we
are able to effectively serve our customers now and in the future.
CentralHudson’s ability to make required energy infrastructure investments,
which are expected to be more than $100 million annually over the next five
years, is strengthened by being a part of the Fortis federation.”

The Acquisition provides Central Hudson customers with nearly US$50 million in
financial benefits to moderate future delivery rates, enhance economic
development programs in the areas serviced by Central Hudson and provide
further assistance to low-income families in the service area. Delivery rates
will be frozen for an additional two years, effectively holding rates constant
for the three-year period from July 2012 through June 2015. Allemployees of
Central Hudson will retain their jobs for at least four years and an
additional 35 union positions will be created. Central Hudson will operate as
a standalone company, its current level of community support will be
guaranteed for at least 10 years and a new board of directors will have
increased localrepresentation.

About Fortis

Fortis is the largest investor-owned distribution utility in Canada, serving
more than 2million gas and electricity customers. Its regulated holdings
include electric utilities in five Canadian provinces and two Caribbean
countries and a natural gas utility in British Columbia. Fortisowns
non-regulated hydroelectric generation assets in Canada, Belize and Upstate
NewYork. TheCorporationalso owns hotels and commercial real estate in
Canada.

About CH Energy Group

CH Energy Group is an energy delivery company headquartered in Poughkeepsie,
New York. Its regulated transmission and distribution subsidiary Central
Hudson serves approximately 300,000 electric and 75,000 natural gas customers
in eight counties of New York State’s Mid-Hudson River Valley, delivering
natural gas and electricity in a 2,600-square-mile service territory that
extends north from the suburbs of metropolitan New York City to the
CapitalDistrict around Albany. CH Energy Group also operates Central Hudson 
Enterprises Corporation, anon-regulated subsidiary composed primarily of
Griffith Energy Services, which suppliespetroleum products and related
services to approximately 56,000 customers in the Mid-Atlantic Region.

Forward-Looking Statements –

Statements included in this new release which are not historical in nature are
intended to be, and are hereby identified as, “forward-looking statements” for
purposes of the safe harbor provided by Section 21E of the Exchange Act.
Forward-looking statements may be identified by words including “anticipates,”
“intends,” “estimates,” “believes,” “projects,” “expects,” “plans,” “assumes,”
“seeks,” and similar expressions. Forward-looking statements including,
without limitation, those relating to CH Energy Group’s and Central Hudson’s
future business prospects, revenues, proceeds, working capital, investment
valuations, liquidity, income, and margins, as well as the acquisition by a
subsidiary of Fortis Inc. and the expected timing of the transaction, are
subject to certain risks and uncertainties that could cause actual results to
differ materially from those indicated in the forward-looking statements, due
to several important factors, including those identified from time to time in
the forward-looking statements. Those factors include, but are not limited to:
the impact of delay or failure to complete the proposed Fortis transaction on
CH Energy Group stock price; deviations from normal seasonal weather and storm
activity; fuel prices; energy supply and demand; potential future
acquisitions; legislative, regulatory, and competitive developments; interest
rates; access to capital; market risks; electric and natural gas industry
restructuring and cost recovery; the ability to obtain adequate and timely
rate relief; changes in fuel supply or costs including future market prices
for energy, capacity, and ancillary services; the success of strategies to
satisfy electricity, natural gas, fuel oil, and propane requirements; the
outcome of pending litigation and certain environmental matters, particularly
the status of inactive hazardous waste disposal sites and waste site
remediation requirements; and certain presently unknown or unforeseen factors,
including, but not limited to, acts of terrorism. CH Energy Group and Central
Hudson undertake no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events, or
otherwise. Given these uncertainties, undue reliance should not be placed on
the forward-looking statements.

Additional Information about the Fortis Transaction and Where to Find It

In connection with the proposed acquisition of CH Energy Group by Fortis, CH
Energy Group filed a definitive proxy statement with the SEC on May 9, 2012,
and has filed other relevant materials with the SEC as well. Investors and
security holders of CH Energy Group are urged to read the proxy statement and
other relevant materials filed with the SEC because they contain important
information about the proposed acquisition and related matters. Investors and
stock shareholders may obtain a free copy of the proxy statement when it
becomes available, and other documents filed by CH Energy Group, at the SEC’s
Web site, www.sec.gov. These documents can also be obtained by investors and
stockholders free of charge from CH Energy Group at CH Energy Group’s website
at www.chenergygroup.com, or by contacting CH Energy Group’s Shareholder
Relations Department at (845) 486-5204.

Contact:

Fortis Inc
Barry Perry, (709) 737-2800
or
CH Energy Group
Denise D. VanBuren, (845) 471-8323