Power company is on trackPublished 8:24am Monday, February 18, 2013
With the recent sale of Shoremaster, previous sales of companies such as health services company DMS, and wind tower manufacturer DMI, Otter Tail Corporation is looking more like it did decades ago when it was an electrical utility and nothing else.
And according to Wall Street, that’s not necessarily a bad thing.
Otter Tail Power decided in the early 1990s to invest in non-utility stocks because, for the most part, electrical utilities lacked the growth needed to satisfy shareholders.
However, the growth in the energy industry, coupled by the recession that deeply impacted many of its non-utility businesses, has forced Otter Tail Power to change gears.
With investments needed in everything from power plants to transmission lines, Otter Tail will need the capital. And with everything indicating that the energy sector will only grow stronger in Minnesota and North Dakota, clearly, such investments seem sensible.
We hope that Shoremaster will continue to operate and profit in Fergus Falls for its new owner. But for Otter Tail Corporation, it only makes sense to get out of a business it does not know — docks and boat lifts — to focus attention on a business it does — electricity production and transmission.
With 785 jobs, 350 of which are located in Fergus Falls, no matter what form the company takes, clearly this region needs Otter Tail Corporation to thrive.
Based on the recent reports, it looks like it’s on the right track.