The merger will create a combined company with total assets of approximately $79 billion, serving seven million electric customers and two million gas customers in Illinois, New Jersey and Pennsylvania.

The new company will have approximately $27 billion in annual revenues and $3.2 billion in annual net income. With a generation portfolio of approximately 52,000 megawatts of domestic capacity, including long-term contracts, the combined company will be the US’ largest power generator.

Under the merger agreement, each common share of PSEG will be converted into 1.225 shares of Exelon. Following the merger, PSEG stockholders will own approximately 32%, or 306 million of Exelon Electric & Gas’ pro-forma shares outstanding, and Exelon shareholders will own approximately 68%, or 650 million shares.

John Rowe, currently chairman, president and CEO of Exelon, will become the president and CEO of Exelon Electric & Gas upon completion of the merger and will be responsible for all operations of the combined company.

Mr Rowe said: The combination of Exelon and PSEG is a compelling transaction that satisfies our stated criteria for a merger. With complementary skills and common regulatory frameworks in three competitive state jurisdictions, all within the same regional transmission organization, we can create additional scale and scope that will provide operational synergies well into the future.

Due to the size of the combined organization, Exelon believes that government regulators may require the new company to divest some assets. Fossil fuel plants owned by PSEG would likely be the main candidates for sale.