Empire District Electric (0.7%) (NYSE:EDE) (EDE – $33.05 – NYSE) On February 9, EDE announced an agreement to be acquired for $34 per share in cash by Algonquin Power & Utilities Corp (AQN). The $34 per share purchase price represents a 21% premium to the previous day’s close and 50% premium to the unaffected share price prior to the December 10, 2015 announcement confirming that EDE was in the early stages of exploring strategic alternatives. The $2.4 billion enterprise value, including assumed debt, represents a 10.9x multiple of our 2017 EBITDA estimate and 21.9x our 2017 earnings estimate of $1.55 per share. The transaction is expected to close in the first quarter of 2017 pending approval of EDE shareholders, and the PUC’s of Arkansas, Kansas, Missouri and Oklahoma, the Federal Communications Commission (the FCC), the Committee on Foreign Investment in the United States and the Federal Energy Regulatory Commission (the FERC). Alogonquin Power & Utilities Corp. is a renewable energy and regulated utility company with an eclectic set of assets, including 35 clean energy facilities netting to 889 MWs of capacity in Canada and seven U.S. states and Liberty Utilities. Liberty is an electric, gas and water utility serving 485,000 customers in ten states. Algonquin will maintain EDE’s headquarters in Joplin, retain all Empire District Electric employees, and place the Empire management team to lead Liberty Utilities' Central U.S. Region.
From Mario Gabelli (Trades, Portfolio)'s Gabelli Utilities Fund first quarter 2016 commentary.
