Merger creates power giant

(CIN) and

(DUK) today announced they have entered into a definitive merger agreement to create an energy company with approximately $36 billion in market capitalisation and 5.4 million retail customers.

The merger, which was unanimously approved by both companies’ boards of directors, will create a combined energy company with assets totalling more than $70 billion.

The combined company, to be named Duke Energy Corporation, will have approximately $27 billion in annual revenues and $1.9 billion in annual net income. It will own and/or operate approximately 54,000 megawatts of electric generation domestically and internationally, relying on a fuel mix of nuclear, coal, natural gas and hydroelectric power to meet customers’ needs.

Under the merger agreement, each common share of Cinergy will be converted into 1.56 shares of Duke Energy upon closing of the merger. Based on the closing prices on May 6, Cinergy investors will receive a premium of 13.4 percent.