Utility reaches deal for $10B sale

TAMPA — Canadian energy and gas company Emera acquired TECO Energy Inc. for $10.4 billion, which includes assuming about $3.9 billion in debt.

TECO Energy (symbol: TE; recent price: $21.07) has more than $20 billion worth of assets and more than 2.4 million electric and gas customers. The boards of both companies approved the deal, according to a statement.

Under the terms of the deal, TECO Energy shareholders will receive $27.55 per common share, a 48% premium based on TECO Energy's closing stock price on July 15.

The sale is subject to TECO Energy common shareholder and government and other regulator approvals. It is expected to close by mid-2016.

Emera officials say the deal will create a top-20 North American regulated utility with geographic diversity and significant growth potential. The combined firm will have more than $20 billion in assets, with 56% of those in Florida; 23% in Canada; 10% in New England; 6% in New Mexico; and 5% in the Caribbean.

Following the sale, the companies expect TECO Energy's headquarters to remain in Tampa and New Mexico Gas Co.'s headquarters to remain in Albuquerque, N.M.

Emera (symbol: EMA.TO; recent price: $44.05) has $6.5 billion in bridge financing from JP Morgan Chase and Scotiabank, and expects permanent financing for the deal will come from selling common and preferred stock and debt.