CenterPoint Announces Plans for After $6B Merger

by Kyle Massey  on Monday, Dec. 3, 2018 3:11 pm   2 min read

CenterPoint Energy Inc., Arkansas' largest natural gas utility, has announced expansion plans after closing a previously announced $6 billion deal to acquire Vectren Corp. of Indiana, creating one of the nation's largest natural gas companies.

CenterPoint, based in Houston, Texas, also named the executives who will lead the combined operation as it grows eastward to the coast.

The nearly $30 billion-asset company resulting from the deal will keep its headquarters in Houston and have electric and gas distribution operations in eight states.

Both companies' boards have approved the deal, which will pay shareholders of Vectren, based in Evansville, Indiana, $72 in cash for each share. CenterPoint will also assume all of Vectren's outstanding debt. The agreement was originally reached in April, when Vectren's stock price was about $65 a share.

CenterPoint President and CEO Scott Prochazka will keep those positions in the new operation. Centerpoint has 3.4 million customers in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and Texas, and 380,000 residential customers and nearly 50,000 business customers in Arkansas.

Vectren provides natural gas to more than a million customers in Indiana and Ohio.

The executive team reporting to Prochazka will include Tracy Bridge, CenterPoint's executive vice president and president of its electric division, who will lead the combine company's electric utility business in Texas. Lynnae Wilson, Vectren's vice president of energy delivery, will be in charge of the electric utility business in Indiana. Scott Doyle, another CenterPoint senior vice president, will lead the combined company's natural gas business, and Joseph Vortherms, a senior vice president of CenterPoint Energy Services, will head competitive business operations, including natural gas supply and sales, commercial development and marketing, and Vectren's Miller Pipeline, Minnesota Limited and Energy Systems Group.

Dana O'Brien, CenterPoint Energy's senior vice president and general counsel, will led the new entity's legal organization. She will also oversee environmental claims. Other leaders will be Sue Ortenstone, CenterPoint's human resources chief, who will lead talent acquisition, compensation and labor relations; and Kenneth Mercado, CenterPoint's integration officer, who will fill a similar role at the combined company.

"This talented and experienced group of leaders is uniquely qualified to drive value for our shareholders, customers, employees and communities, while enhancing growth opportunities for our businesses," Prochazka said in a company statement. "I look forward to working alongside this team to further advance our vision to lead the nation in delivering energy, service and value."

The merger is expected to close in the first quarter of 2019.

William Rogers, CenterPoint Energy's executive vice president and chief financial officer, plans to retire for what the company called "personal and family reasons." He will stay in his post through the first quarter of 2019 "to help ensure a seamless closing of the pending merger and transition," the company said.

The company will install a chief business officer for Vectren's electric operations, and that executive will report directly to Prochazka, according to CenterPoint's website. The new business chief will spearhead a modernization of southwestern Indiana's electric grid. The combined company will keep key operational support sites in Evansville, and is planning a major push into the East Coast energy market.

 

 

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