Always Building, Payoff Deferred – A Valuation of Yukon Energy Corporation

Crown Corporations, Ian Madsen, Valuation

Yukon Energy Corporation (YEC) is a sprawling generator and distributor of electric power to customers in Yukon Territory. It could be worth as much as $212M were it divested, making the assumption that its chronic heavy capital investment program will end soon. As a business, making the very optimistic assumption that it can turn its stated net income into free cash flow, its value, on a fully taxed basis (as a Crown corporation, it pays no tax, now), is estimated between $165-$212M. Using nineteen comparable Canadian and US-listed hydroelectric-dominated and other utility firms, the market value range is $155-$158M. This last narrow range should not be construed as having high accuracy; these are just estimates.

Read the entire Valuation here: VS11_YECvaluation_JA0319_F1