Boston, MA 06/24/2014 (wallstreetpr) – Integrys Energy Group, Inc. (NYSE:TEG) has entered into a definitive agreement with Wisconsin Energy Corp (NYSE:WEC), which announced that it will buy the former company in a $9.1 billion.
Terms Of Agreement
Wisconsin Energy Corp (NYSE:WEC) announced that the $9.1 billion transaction will be made partly in cash and partly in stock. The cash part of the deal will value $5.7 billion, as per the terms of the agreement, the company said. WEC Energy will also have a 60% stake in American Transmission Co.
According to the deal, which was announced on Monday, Integrys Energy Group, Inc. (NYSE:TEG) shareholders will be receiving 1.128 shares of Wisconsin Energy Corp (NYSE:WEC). In addition, it will also receive $18.58 per share owned. Total consideration allows a hike of 17% to Integrys closing stock price, which was $60.95 on Friday. Hence, every share of the company will be valued at $71.47. The consideration is proposed to be 26% cash and the remaining stock.
New Entity
With this acquisition, Wisconsin Energy Corp (NYSE:WEC) seeks to establish a diversified Midwest electric and natural gas company. Upon completion of the take- over procedure, the new entity will be named WEC Energy Group. The new company will serve over 4.3 million customers availing gas and electricity in Wisconsin, Michigan, Minnesota and Illinois. It is proposed that the company will operate approximately 71,000 miles of electric transmission lines and over 44,000 miles of gas distribution and transmission lines. It is expected to have a regulated rate base of $16.8 billion by next year.
Integrys Energy Group, Inc. (NYSE:TEG) shareholders will own around 28% of the new entity that will be formed from the merger. Wisconsin’s Chairman and Chief Executive Officer Gale Klappa will continue to assume the same role in the new company while Integrys’ Chairman and CEO Chalie Schrock will retire after the acquisition.
Shares of the Chicago based company rose 16.3% up to $70.90 after the acquisition was announced.
