FERC Tuesday issued an order approving WPS Resources Corp.'s $1.52 billion purchase of Peoples Energy Corp. (see Daily GPI, July 7). The deal, which was approved by the shareholders of both companies earlier this month, is expected to close in the first quarter of 2007 pending approval by Illinois and Wisconsin regulators.
"We will authorize the merger as consistent with the public interest, as we find that it will not have an adverse effect on competition, rates or regulations," the Federal Energy Regulatory Commission said [EC06-152].
The combined company will be called Integrys Energy Group Inc. and will have assets of about $9.2 billion and a market capitalization approaching $4 billion. On the regulated side, the company will have more than 1.6 million natural gas customers and nearly half a million electric customers, with operations in four states: Illinois, Wisconsin, Michigan and Minnesota.
Green Bay, WI-based WPS Resources is a holding company with five major subsidiaries providing electricity and natural gas and related services in both regulated and nonregulated energy markets. Its largest subsidiary is Wisconsin Public Service Corp., a regulated electric and natural gas utility serving northeastern Wisconsin and a portion of Michigan's Upper Peninsula. Wisconsin Public Service caters to more than 425,000 electric customers and 308,000 natural gas customers. Another subsidiary, Upper Peninsula Power Co., is a regulated electric utility that provides service to approximately 52,000 electric customers in Michigan's Upper Peninsula. Michigan Gas Utilities Corp. is a regulated gas utility serving 161,000 customers in lower Michigan. Minnesota Energy Services Corp. is a regulated gas utility with more than 200,000 customers throughout Minnesota.
WPS Resources' major nonregulated subsidiary is WPS Energy Services Inc., a diversified energy supply and services company serving commercial, industrial and wholesale customers and aggregated groups of residential customers. Its principal market is the northeast quadrant of the United States and adjacent portions of Canada.
Peoples Energy of Chicago is a diversified energy company with gas distribution, oil and gas production and marketing assets. Peoples Gas and North Shore Gas, both regulated utilities, deliver natural gas to about 1 million customers in Chicago and 54 communities in northeastern Illinois. The company's nonutility businesses include Peoples Energy Services (PESC) and Peoples Energy Production (PEP). PESC, launched in 1996, serves more than 40,000 customers. PEP, founded in 1998, is primarily focused on acquiring proven onshore reserves with upside potential in a limited number of strategic supply basins.
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