Under the terms of the merger agreement, which has been approved by the boards of directors of both companies, Mirant stockholders will receive a fixed ratio of 2.835 shares of RRI Energy common stock for each share of Mirant common stock they own.
The ratio reflects an at-market transaction based on the volume-weighted average price for the preceding 10 trading days. Upon closing, which is expected before the end of 2010, Mirant stockholders will own approximately 54% of the equity of the combined company and RRI Energy stockholders will own approximately 46%.
Edward Muller, chairman and CEO of Mirant, said: “Bringing together RRI Energy and Mirant is a true merger of equals, combining two companies with complementary strengths, a shared strategic vision and a commitment to value creation.
“This compelling combination will create tremendous value for stockholders of both companies as our business benefits from cost savings, greater scale, and enhanced financial strength and flexibility.”
The transaction is subject to customary closing conditions, including approval by the stockholders of RRI Energy and Mirant, US antitrust approval and approval by the Federal Energy Regulatory Commission (FERC). The closing is also subject to the refinancing of a portion of each company’s existing debt.
