Duke Energy buying Cinergy for $9 billion in stock; creates company with 5.4 million customers

Monday, May 9th 2005, 8:40 am

By: News On 6

NEW YORK (AP) _ Duke Energy Corp. agreed to acquire Cinergy Corp. for stock valued at about $9 billion, a deal that will create an energy company with about 5.4 million retail customers and more than $70 billion in assets.

The deal, announced Monday, was unanimously approved by both companies' boards.

The new company, to keep the name Duke Energy Corp., will have about $27 billion in annual revenue.

Under the merger agreement, each common share of Cincinnati-based Cinergy will be converted into 1.56 shares of Duke Energy. Based on the stock's Friday closing price of $40.38, Cinergy investors will receive a premium of 13.4 percent.

Following the merger, Cinergy shareholders will own about 24 percent, or 310 million shares, of the new company, and Duke Energy shareholders will own about 76 percent of the total 1.3 billion shares. Duke Energy, based in Charlotte, N.C., reported earnings of $1.49 billion on revenue of $22.50 billion in 2004. Cinergy, based in Cincinnati, posted 2004 net income of $400.9 million on sales of $4.69 billion.

The two companies currently employ about 29,350 and expect a reduction of about 1,500, primarily through attrition and early retirement.