Duke Energy to buy Progress Energy

[locator00566]

Duke Energy (NYSE: DUK) and Progress Energy (NYSE: PGN) are deep into merger talks and a deal combining the two North Carolina utility giants could be announced before stock markets open on Monday, according to several media reports.

The Financial Times, Wall Street Journal, The Wall Street Journal and other media outlets all reported the advanced talks on Sunday. They cited unnamed sources familiar with the talks.

A Duke spokesman told WRAL.com on Sunday that the company could not confirm a merger or even a "major announcement" of any story.

Mike Hughes of Progress Energy told WRAL.com that the company could not comment on speculation and could not say the firm is going to be involved in any major announcements on Monday.

"Duke Energy Corp. is close to a deal to buy Progress Energy Inc. in an all-stock merger that would value its smaller rival at more than $13 billion, people familiar with the matter said," the Journal reported Sunday.

By "joining forces," the companies would "save on costs and seek cheaper sources of energy," the Journal noted.

However, the Journal noted its sources said that "final details are still being negotiated and things could still fall part."

State regulators in North and South Carolina would have to approve the deal.

If the companies were combined, they would form one of the nation's largest utilities with some 7 million customers.

Progress, which is based in Raleigh, services customers in the Carolinas and Florida.

Duke also offers utility services in the Carolinas as well as the Midwest.

Talks about a possible merger first surfaced on Friday. A Progress spokesman told WRAL.com that the company would have no comment.

If a merger were to go through, it would be valued at some $13 billion. Duke also would assume some $11 billion in Progress debt.

Duke reportedly would pay a slight premium over Progress' closing stock price of $44.72. Shares climbed 82 cents, or 1.9 percent, as reports about the possible merger emerged.

Duke shares closed Friday at $17.79, up 5 cents.

"People familiar with the matter said that the deal between Duke and Progress would be a stock-based transaction, creating a merged company worth about $36 billion," The Financial Times reported. "Progress’ market value at the end of last week was $13.1 billion, while Duke was worth $23.6 billion."

[Paint'n & Flag'n]

Wonder how this will affect the contracts with P.E.? USIC doesnt have the Duke contract, will that mean that USIC will gain or loose a contract? Be interesting.

[locator00566]

Wonder how this will affect the contracts with P.E.? USIC doesnt have the Duke contract, will that mean that USIC will gain or loose a contract? Be interesting.

Lets hope USIC looses the contract.