Duke Energy and Progress Energy will announce a merger today that will base the combined N.C. power companies in Charlotte and make it the nation's biggest electric utility with 7.1 million customers, a person familiar with the situation said Sunday.
Charlotte-based Duke's all-stock purchase of the smaller utility would leave Progress with a significant presence in its Raleigh base while accelerating Charlotte's efforts to build an energy hub in the region.
The merger would need approval of shareholders and regulators, including the N.C. Utilities Commission and the Federal Energy Regulatory Commission. The regulators would review the effect on consumers, such as through cost savings because of reduced staffs.
The companies believe they'll gain the approvals by the end of the year and that the deal will result in "huge benefits for customers in terms of savings," the person said.
The (Raleigh) News & Observer also confirmed the deal with two sources familiar with the negotiations. Spokesmen for both companies declined comment.
The deal would offer a "modest premium" to Progress' share price, which closed Friday at $44.72 and set a market value of $13.1 billion. The combined company would have a market value of $36 billion and be capable of generating 56,000 megawatts of power. That's a 60 percent increase over Duke's current capacity.
The merged firm would be called Duke Energy, though it was not clear who would be the leader. Duke chairman and chief executive Jim Rogers and Progress CEO William Johnson started talking about a strategic combination in July, the person said.
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