NU To Buy NStar In All-Stock Deal
In what the two companies are calling a "merger of equals" Boston-based NStar and Hartford, Conn.-based Northeast Utilities have approved a merger to create a $17.5 billion gas and electric firm that will serve 3.5 million customers in three states.
The agreement calls for NU to buy NStar in an all-stock deal in which NStar shareholders will get 1.3 common shares of NU stock for each NStar share they hold for a total equity value of $9.5 million, the companies said in a statement.
The company will be known as Northeast Utilities and Thomas J. May, president and CEO of NStar, will become president and CEO of NU.
Charles W. Shivery, current president and CEO of NU, will be the company's non-executive chairman for 18 months after the deal is closed.
Merged, NU will have more than 9,000 employees and run six electric and gas utilities in Massachusetts, Connecticut and New Hampshire.
Two-thirds of the companies' shareholders must approve the merger. The companies expect that to happen in early 2011 and for regulatory approvals to be granted in the next 12 months.
The deal will be reviewed by the state Department of Public Utilities; the Federal Energy Regulatory Commission; the Nuclear Regulatory Commission; the Securities and Exchange Commission and the Federal Communications Commission.
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