Entergy announces ITC Holdings merger
Entergy announces $1.78 billion merge with ITC Holdings.
Merger and acquisition advisors may been called in to assist recent negotiations between Entergy and ITC Holdings leading up to an announcement yesterday (December 5th) that the firms had struck a merger deal.
The agreement, which will see power generator Entergy divest its transmission business then merge it with energy distributor ITC, is expected to raise gross cash proceeds of $1.78 billion (£1.12 billion).
While these assets, which will arise from the indebtedness incurred by the merger and are to be assumed by ITC, will be received by Entergy, ITC will issue a $700 million dividend to its shareholders.
Chief executive of Entergy Wayne Leonard explained to Reuters his company no longer wanted to operate in the transmission of power.
"We're in a business that we shouldn't be in," he stated. "It's a business that is best suited in the hands of someone who does only this."
Entergy runs ten plants across the US and is the second-largest nuclear power generator in the country.
Posted by Edel Quinn