NextEra Energy and Dominion Energy announced Monday an agreement to merge in an all-stock transaction valued at $66.8 billion that would create the largest regulated electric utility in the country serving nearly 10 million customers across Florida, Virginia, North Carolina and South Carolina.
Kirkland & Ellis advised NextEra with a team led by Zach Savrick and Andy Calder in Houston with David Feirstein, who works from Houston and New York, and Brooksany Barrowes in Washington, D.C. Charles Sieving is NextEra Energy’s chief legal officer. Jim Stuckey is vice president and general counsel at Dominion Energy, which tapped McGuireWoods as outside legal counsel.
“Electricity demand is rising faster than it has in decades,” according to John Ketchum, chairman, president and CEO of NextEra Energy. “Projects are getting larger and more complex. Customers need affordable and reliable power now, not years from now. We are bringing NextEra Energy and Dominion Energy together because scale matters more than ever — not for the sake of size, but because scale translates into capital and operating efficiencies. It enables us to buy, build, finance and operate more efficiently, which translates into more affordable electricity for our customers in the long run.”
The combined company is proposing $2.25 billion in bill credits for Dominion Energy customers in Virginia, North Carolina and South Carolina spread over two years upon close that is expected in 12 to 18 months. Ketchum, who will be chairman and CEO of the combined company, said the merger creates scale, as well as operating and capital efficiencies that enable the bill credits.
Robert Blue will serve as president and CEO of the new company’s regulated utilities, and he will also have a seat on the board of directors.
Dominion Energy shareholders will receive 0.8138 shares of NextEra Energy for each share held, and NextEra Energy will own about 74.5 percent of the combined utility, which will be more than 80% regulated and own 110 gigawatts of power generation across a mix of energy sources. Dominion shareholder would also receive a one-time cash payment of $360 million at closing.
The combined company will have dual headquarters in Juno Beach, Fla., and Richmond, Va., while also maintaining the Dominion Energy operational headquarters in Cayce, S.C.
The companies said the merged entity would be the largest utility in terms of renewables and battery storage and also would be the largest in the U.S. in terms of total generation, gas generation, rate base and market capitalization, as well as the second largest in nuclear generation.
Lazard acted as lead financial advisor to NextEra with BofA and Wells Fargo also serving as financial advisors. Goldman Sachs and J.P. Morgan are co-financial advisors to Dominion Energy.
The Kirkland team that advised NextEra also included Nick Lewis, Andrew Watson, Zach Sheehan, Braxton Iden, Chase Bortel, Jonathan Macke, Rebecca Fine, Ben Samway and Grant Solomon in Dallas.
Phil Greenfield, Samantha Siegler, Matias Joseph, Julian Seiguer, Sara Lampert, Kristin Kluding, Robbie Dillard, Rachael Lichman, Damien Lyster, Stephen Jacobson, Brandon Newman, Justin Coddington and Will Zakhary advised from Houston.
Grant Bowen provided counsel from Boston with John Decker, Darren Fernandez, Drew Stuyvenberg, Andrew DeVore, Ethan Heben, Cassidy Hall and Kevin Hivick in Washington, D.C.
Sara Zablotney advised from New York and Paul Tanaka from San Francisco.