The wheels are spinning on a $9 billion utility merger.
The parent company of We Energies wants to buy the parent company of the Wisconsin Public Service Corporation. If regulators agree, the merger would affect customers in four states.
Most interested parties are talking about the potential impacts on customers.
Executives from the two utilities held a conference call to announce the deal. Gale Klappa is CEO of We Energies’ parent company - the Wisconsin Energy Corporation.
It wants to buy Integrys. It’s based in Chicago, but the offices of its Wisconsin Public Service Corporation are in Green Bay.
Klappa says the headquarters of the merged company would be located in Milwaukee.
“Combining our two companies will create the leading electric and natural gas utility system in the Midwest. We’ll have more than four million customers in Wisconsin, Illinois, Michigan and Minnesota. The combination will create the eighth largest natural gas distribution company in America,” Klappa says.
Integrys owns a huge natural gas company. WE Energies burns coal to generate a good deal of its electricity.
“The combined company will be larger, more diverse and well positioned to meet the region’s future energy needs and the strong cash flow of the combined company will be prudently invested in new and upgraded energy infrastructure,” Klappa says.
The name of the new company would be WEC Energy Group. And Klappa promises it would better serve customers.
News of a merger surprised the watchdog group, Citizens Utility Board of Wisconsin. Kira Loehr is acting executive director. She says the rates customers now pay, differ.
“Our primary concern is which direction the rates are going to go, since We Energies rates and bills for customers are significantly higher than Wisconsin Public Service Corporation’s rates and bills for customers. We want to ensure that this transaction does not result in all of Wisconsin Public Service Corporation’s customers having bills the same size as the current levels for WE Energies,” Loehr says.
Loehr says CUB will spend the coming months reviewing the proposal. She expects the board to propose a series of conditions, to keep customer rates reasonable. Both state and federal regulators must approve the merger.
The Wisconsin Energy Corporation is also seeking approval from its stockholders, while Integrys brings about 25,000 shareholders to the table. Planners hope to finalize the transaction by next summer.