Energy Companies Duke Energy and Progress Energy to Merge

January 10, 2011 Updated: January 10, 2011

[xtypo_dropcap]E[/xtypo_dropcap]nergy companies Duke Energy and Progress Energy are set to merge, with Duke buying the former energy company for $13.7 billion, the two companies announced in a Monday statement.

After the merger, the new company, which will be called Duke Energy, will be the largest utility in the nation, with a market capitalization of $37 billion and 7.1 million energy customers.

The Charlotte, N.C.-based Duke plans to pay a 6.4 percent premium over the past 20 trading days for the Raleigh, N.C.-based Progress, the statement said. The total value of the deal comes out to $46.48 per share of Progress Energy.

“Our industry is entering a building phase where we must invest in an array of new technologies to reduce our environmental footprints and become more efficient,” Jim Rogers, chairman, president and CEO of Duke Energy, said in a release.

“By merging our companies, we can do that more economically for our customers, improve shareholder value and continue to grow.”

Post-merger Duke Energy will provide 57 gigawatts of generating capacity from coal, nuclear, oil, natural gas, and renewable energies, for customers in North and South Carolina, Florida, Indiana, Ohio, and Kentucky.

Duke Energy Corporation stock (DUK, NYSE) slipped in morning trading, falling 1.5 percent ($0.27, to $17.52) as of 12:55 p.m. EST. Progress Energy Inc. (PGN, NYSE) stock was also down, by nearly 2 percent ($0.87) to $43.85.