The boards of Spain-headquartered electric utility and wind power developer Iberdrola S.A. and Energy East Corporation, a regional utility company with offices in Albany, N.Y., and Portland, Maine, have approved a merger agreement under which Iberdrola will acquire 100% of Energy East for $4.5 billion.
Under the terms of the merger agreement, the shareholders of Energy East would receive $28.50 in cash per share at closing, representing a premium of 20.2% over Energy East's average closing stock price for the 30-day period ending June 22, 2007 (27.4% over Energy East's closing stock price on June 22, 2007).
The transaction is subject to approval by the shareholders of Energy East, federal and state authorizations, and other customary closing conditions and is expected to close in 2008, the companies add.
‘This new step in the United States will allow Iberdrola to continue working with national and state governments to make investments in infrastructure that advance clean energy policies. We welcome Energy East's employees and look forward to leveraging our experience to help address some of the most challenging energy and environmental issues in the northeastern U.S.,’ says Ignacio Galan, chairman and chief executive officer of Iberdrola.
This transaction allows Iberdrola to increase its presence in the U.S. and accelerates the achievement of the internationalization objective set in its strategic plan approved last October, the company notes. Iberdrola plans to explore opportunities to expand its wind generation portfolio, which includes the upstate New York-based Maple Ridge wind farm.