This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Energy Market Deals: Dynegy, Allis-Chalmers

(Dynegy, Allis-Chalmers story, updated for RRI Energy, Mirant gains)

NEW YORK ( TheStreet) -- Two big energy market deals on Friday morning caused huge spikes in shares of Dynegy (DYN - Get Report) and Allis-Chalmers (ALY). Both companies are being taken out -- by way of private equity purchase, in the case of Dynegy, and an acquisition, in the case of Allis Chalmers.

Dynegy, which sells electricity, agreed to be taken private by the Blackstone Group (BX - Get Report) for $4.7 billion, including debt, one of the biggest leverage buyout deals of 2010.

The $4.50 per share in cash that Blackstone is paying for Dynegy is a 62% premium to Thursday's closing price, causing the massive spike in shares of the electricity market company.

The Dynegy-Blackstone deal was causing a spike in share of wholesale power sales companies. RRI Energy (RRI) and Mirant (MIR) had among the largest gains in the equity market on Friday morning, up between 7% and 8%. Both merchant energy companies had reached their average daily trading volume within an hour of the market open. Notably, both RRI Energy and Mirant had traded at 52-week low prices on Thursday.

Wholesale power provider Calpine (CPN - Get Report) was also up more than 6% on Friday morning.

Concurrent with the privatization of Dynegy, Blackstone is selling four natural-gas plants to NRG Energy (NRG - Get Report) for $1.36 billion.

It's not a done deal yet. Dynegy has a 40-day period during which it can solicit potentially higher or better bids.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
DYN $26.22 1.30%
BX $39.15 -0.36%
CPN $18.37 5.00%
NRG $22.58 0.98%
AAPL $121.27 -0.90%

Markets

Chart of I:DJI
DOW 17,706.43 -39.55 -0.22%
S&P 500 2,108.14 -0.49 -0.02%
NASDAQ 5,138.2570 +9.4720 0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs