The lights went out on the proposed merger between
. The two companies this morning said they jointly agreed to terminate the merger agreement they signed last July.
The coupling would have created the No. 1 power distribution company.
FPL's statement offered little explanation about the breakup, saying only that both companies agreed no termination fee is payable unless either company agrees to a substantially comparable transaction with another party in the next nine months.
Entergy said that agreeing to FPL's terms wouldn't create the merger of equals shareholders approved. Its board also said it believed "there would be no prospects for regulatory approval because commitments and representations made to regulators would be violated, and no ability to drive the unregulated growth businesses in a direction that Entergy believed would create the most value for its shareholders."
Entergy's statement also said that FPL's chairman and CEO, James Broadhead, proposed changing the merged company management structure. Entergy's financial advisors --
Morgan Stanley Dean Witter
-- told the company "that with no premium to shareholders and a revised management structure, the transaction was equivalent to a takeover without a premium."
Entergy this morning also announced financial guidance for 2002. The company said it expects earnings in a range of $3.30 to $3.50 a share. That's on track with the current estimate of analysts polled by
Thomson Financial/First Call
. They are expecting earnings of $3.40 a share.
FPL closed at $61.30 on Friday, off its 52-week high of $73, but up substantially from its annual low of $41.81. Entergy closed at $38. Its stock price has ranged from $19.37 to $43.87 over the past year.