Amber Kanwar

Anchor, Reporter

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Hydro One’s $1.7 billion share sale is not yet fully sold and is unlikely to be upsized given soft demand, according to people familiar with the matter.

The Ontario government announced on Tuesday it would be selling 15 per cent of its ownership stake in the electric utility. The shares were priced at only a 2.1 per cent discount to Tuesday’s closing price.

While the deal is “close” to fully sold, it did not fly off the shelves, according to people familiar with the sale.

“The pricing of the deal has made it a tougher sell than first thought,” said one person who asked not to be identified because they are not authorized to speak on the matter.

As of Thursday afternoon, 97 per cent of the deal was placed, with the last three per cent “a tough sell.”

The Ontario government has stated it intends to sell as much as 60 per cent of its stake in Hydro One over several years. Hydro One went public just five months ago and its stock has increased 15 per cent since then. Bank of Nova Scotia and Royal Bank of Canada co-lead the IPO and this week’s bought deal.

Royal Bank of Canada had no comment when reached. Hydro One and Bank of Nova Scotia did not respond to requests for comment.