CenterPoint Energy and Vectren Corp. plan to merge
In moving to acquire Indiana-based Vectren Corp., CenterPoint Energy Inc. announced it will make Evansville, Indiana, the headquarters for its natural gas division.
In a joint news release, CenterPoint, based in Houston, and Vectren said the $6 billion deal will reap cost savings as the two large utilities look to merge.
Vectren, ranked as Indiana’s 13th largest public company with 5,800 employees, supplies gas or electricity to more than a million customers in the state and takes in $2.4 billion in annual revenue. Its service territory covers nearly two-thirds of Indiana and about 20 percent of Ohio.
Vectren also serves suburban Indianapolis through its Vectren North division, which has 580,000 gas customers.
CenterPoint has almost 8,000 employees and more than 5 million customers, primarily across Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and Texas.
“With CenterPoint Energy, we’ve found the right partner to begin the next chapter for Vectren and our family of companies,” Vectren CEO Carl Chapman said in the news release. “Together, we will be a stronger, more competitive company that will be well-positioned to continue to provide value for our stakeholders in the years to come.”
CenterPoint has also pledged to contribute an additional $3 million per year for at least five years to the Vectren Foundation, which supports education, environmental conservation and environmental stewardship, in addition to community revitalization and sustainability, Chapman said.
CenterPoint CEO Scott Prochazka said the potential merger is a significant step in its ongoing vision for the future. “By combining our two highly complementary companies, we are creating an energy delivery, infrastructure and services leader that will drive value for our shareholders and customers, while enhancing growth opportunities for our businesses,” he said.
Vectren shareholders will receive $72 in cash for each of their shares, a premium of nearly 10 percent above Vectren’s close on the Friday before the announcement, according to the companies.