ITC Holdings signs agreement to acquire Michigan Electric Transmission Co.

Novi and Ann Arbor, MI, May 16, 2006 — ITC Holdings Corp. (ITC Holdings) announced it has signed a definitive agreement to acquire all of the outstanding equity interests in Michigan Electric Transmission Co. LLC (METC), a privately-held company and the neighboring transmission system to ITCTransmission, ITC Holdings’ wholly owned operating subsidiary, in a transaction valued at approximately $866 million.

Under the terms of the agreement, METC’s selling shareholders, Trans-Elect Inc., a GFI Energy Ventures LLC portfolio company, affiliates of Evercore Capital Partners, Macquarie Essential Assets Partnership and other private investors, will receive $486 million in cash and approximately $70 million in shares of ITC Holdings common stock. In addition, ITC Holdings will assume, or refinance at METC, approximately $311 million of METC debt.

ITCTransmission owns, manages and maintains the high-voltage, electric transmission system in southeastern Michigan and is the first fully independent transmission company in the country. METC owns and manages the high-voltage electricity transmission system in the western portion of Michigan’s Lower Peninsula. Upon completion of the acquisition, ITC Holdings’ subsidiaries will own and operate the transmission system for almost the entire Lower Peninsula of Michigan and together will own and operate the largest independent transmission system in the United States.

The transaction is subject to customary closing conditions and regulatory approvals, including approval from the Federal Energy Regulatory Commission and antitrust review under the Hart-Scott-Rodino Act. The approval of ITC Holdings’s shareholders is not required. ITC Holdings expects the transaction to close in the second half of 2006.

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