"NV Energy's desire to invest in renewables and related transmission assets in Nevada parallels [MidAmerican' Energy's] significant investments in wind and, more recently, solar generation," Peter D. Quinn a Bank of America Merrill Lynch analyst wrote of Wednesday's acquisition. MidAmerican's three solar plant investments, for instance, take advantage of California's goal to shift its energy generation mix towards renewable energy in coming years. NV Energy will also complement Mid American's natural gas pipeline infrastructure, particularly in the western parts of the U.S. MidAmerican Energy will pay a 23% premium for Las Vegas-based NV Energy over Wednesday's closing price of $19.28, however, the deal is just a 9.8% premium to NV Energy's 52-week high hit on April 30, according to Quinn of BAML. MidAmerican's acquisition has already been agreed by both companies' boards of directors. However, it will face review by Nevada officials given NV Energy's status as a regulated utility. The deal will also face review by the Department of Justice and the Federal Energy Regulatory Commission, according to Citigroup analysts.
"[There] doesn't appear to be any antitrust issues at the surface," writes Shahriar Pourreza of Citigroup, who highlights the Nevada Public Utilities Commission as the regulator that may push back against Wednesday's deal, given the prospect of job cuts and synergy. MidAmerican expects to complete its acquisition by the first quarter of 2014 and will operate NV Energy as a separate corporate subsidiary under its current name. The company will continue to be headquartered in Las Vegas, according to a press release. "[We] will have the opportunity to combine MidAmerican's expertise in renewable energy with Nevada's vast renewable resources for the benefit of our customers and our state," Michael Yackira, President and CEO of NV Energy, said in a statement.