WEC Energy Group Inc. (WEC, Financial)(1.8%) (WEC – $52.22 – NYSE) On June 29, 2015, Wisconsin Energy Company completed its acquisition of Integrys Energy Group (TEG). The agreement valued TEG at $9.1 billion enterprise value, and consisted of stock, cash, and the assumption of $3.3 billion of debt. Each TEG share received 1.128 shares of WEC and $18.58 per share in cash. The combined company’s assets include Wisconsin Electric, the state’s largest electric utility, with over 1.1 million electric customers and 1.1 million gas customers in southeastern, east central, and northern Wisconsin, and 400,000 electric customers and 1.7 million gas customers in Illinois, Michigan, Minnesota, and Wisconsin. Management forecasts the combined company growth rate at 6%-8% in 2016 and 5%-7% over the long term, which is higher than both WEC and TEG’s standalone growth rates of 4%-6% per annum. Additionally, WEC increased its ownership stake to 60% in the American Transmission Corporation. Over the long term, we believe the ownership in ATC not only provides favorable investment opportunities, but also financial engineering optionality
From Mario Gabelli (Trades, Portfolio)'s Gabelli Industrials Fund shareholder commentary for third quarter 2015.
