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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Wisconsin Energy to Acquire Integrys Energy in $9.1B Deal

NEW YORK (The Deal) -- Wisconsin Energy's (WEC) announced deal on Monday to acquire Integrys Energy Group (TEG) for $9.1 billion, was a negotiated deal, said sources familiar with the matter.

The transaction, which is being done in cash, stock and assumed debt, is valued at $71.41 per Integrys share; the company's shares closed at $60.95 Friday. This represents a 17.3% premium to Integrys' closing price on June 20 and a 22.8% premium to the volume-weighted average share price over the past 30 days.

Should the deal go forward, it would create a combined utility that the companies project will have a regulated rate base of $16.8 billion in 2015, serve more than 4.3 million total gas and electric customers across Wisconsin, Illinois, Michigan and Minnesota, and operate nearly 71,000 miles of electric distribution lines and more than 44,000 miles of gas transmission and distribution lines, according to the statement.

Along with the merger announcement Integrys, of Chicago, said that, as part of an ongoing portfolio review it was in the late stage of a competitive process to sell its non-regulated marketing subsidiary Integrys Energy Services.

The tie-up comes amid a boom of M&A activity in the power and utilities sector, as electric utilities look to tip their portfolios more heavily toward the regulated arena. Utilities are moving in this direction, as forward power prices remain weak due to the low price of natural gas and excess power supply.

Similar deals in the sector are Exelon (EXC) acquiring fully regulated Pepco Holdings (POM) in a $6.8 billion deal. At $27.25 per share, the deal was a 20% premium to the closing price the day before the deal was announced.

Last week, The Deal reported that Louisiana power company Cleco (CNL) had hired Goldman Sachs & Co. to advise it on a potential sale after Canadian infrastructure group Borealis Infrastructure made an unsolicited bid for the company.

On Monday, Cleco confirmed that it had hired the bank to assist it after third parties were in touch regarding a potential strategic transaction.

The Wisconsin-Integrys transaction is subject to approvals from the shareholders of both companies, the Federal Energy Regulatory Commission, Federal Communications Commission, as well as the applicable state regulatory bodies. The transaction is also subject to Hart-Scott-Rodino Act and other customary closing conditions.

The companies anticipate closing in the summer of 2015.

Gale Klappa, chairman and CEO of Wisconsin Energy, will become chairman and CEO of the combined entity, with Charlie Schrock, chairman and CEO of Integrys, retiring upon the closing of the transaction.

Milwaukee-based Wisconsin Energy turned to Barclays for financial advice, with John Lange and Jim Penrose heading up the team, sources said. Skadden, Arps, Slate, Meagher & Flom LLP's Susan Hassan, Clifford "Mike" Naeve, David Rievman, Joseph Yaffe, Don Frost Jr., Nancy Olson, Bruce Goldner, Seth Jacobson, John Lyons and John Furfaro as legal counsel.

Lazard's George Bilicic and Jonathan Mir are leading Integrys' financial advisory team, and Cravath, Swaine & Moore LLP's Mark I. Greene, Andrew R. Thompson, Michael L. Schler, Eric W. Hilfers and Christine A. Varney, as well as Foley & Lardner LLP are providing legal counsel.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,113.54 +61.81 0.36%
S&P 500 1,983.53 +9.90 0.50%
NASDAQ 4,456.0160 +31.3120 0.71%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs