Integrys Energy (TEG) shares vaulted higher by some 15% after the company said Monday it agreed to be bought by Wisconsin Energy Corp. (WEC) in a cash-and-stock deal worth about $5.71 billion.
Under the terms of the deal, Wisconsin Energy, which is based in Milwaukee, will pay 1.128 a share and $18.58 in cash, or $71.47 per share based on Wisconsin Energy’s Friday close, the companies said in announcing the deal. The per-share value of the deal represents a premium of 17.3% to Integrys’ PPS close on Friday.
The combined company, which will be called WEC Energy Group Inc., will have 4.3 million gas and electric customers in Wisconsin, Illinois, Michigan and Minnesota. It will unite Wisconsin Energy’s We Energies with Integrys’s five utilities, including Wisconsin Public Service and North Shore Gas.
“We believe this combination provides a unique opportunity to create the premier regulated utility system in the Midwest, with superior service and competitive pricing for years to come,” Wisconsin Energy’s chairman and chief executive Gale E. Klappa said in a statement. “The operational and financial benefits to all of our stakeholders – from the customers and communities we serve, to the people we employ, to the shareholders who count on us to create value – are clear, achievable and compelling.”
The deal, which including debt is valued at $9.1 billion, is expected to close in the summer of 2015 subject to state and federal regulatory approvals.
Shares of Integrys climbed as high as $70.61 late Monday morning. Wisconsin Energy fell 3.09% to $45.44.