NEW YORK, Dec 20 (AFP) - US energy firm Exelon Corp. agreed to pay about 12 billion dollars in stock to take over Public Service Enterprise Group Inc. (PSEG), creating a new power titan, the firms said Monday.
The deal was backed unanimously by the companies' boards, they said in a statement.
Under the terms of the agreement, Exelon pays 1.225 shares for each share of New Jersey-based PSEG.
Based on Friday's closing share price for Exelon, the purchase would be worth 12.19 billion dollars.
The combined company would have total assets of about 79 billion dollars, serving seven million electric customers and two million gas customers in Illinois, New Jersey and Pennsylvania.
It would reap in 27 billion dollars in annual revenues and 3.2 billion dollars in annual net profit, the firms said.
After the takeover, Exelon shareholders would own about 68 percent of the combined company -- to be known as Exelon Electric and Gas -- and PSEG shareholders the remaining 32 percent.
The deal must still be approved by shareholders of both companies, antitrust authorities and federal and state energy regulators.
"The combination of Exelon and PSEG is a compelling transaction that satisfies our stated criteria for a merger," said Exelon chairman, president and chief executive John Rowe.
"It is accretive with sound returns, it can be accomplished without compromising our financial integrity, and it creates a strategic mix of assets," he said.
Rowe would president and chief executive of the new firm, Exelon Electric and Gas.
James Ferland, now chairman, president and chief executive officer of PSEG, will become non-executive chairman until his planned retirement in early 2007, the companies said.
12/20/2004 15:20 GMT - AFP