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On Friday, November 9, stockholders of retail energy providers NRG Energy and GenOn Energy announced that they had approved a merger between the two companies by a large majority, which came after both firms previously announced plans for the merger during previous meetings.
The merger is huge for the retail energy sector, and will create a large company that is expected to be a driving force in the industry.
"Today's overwhelming shareholder vote in favor of the NRG/GenOn combination reflects the reality that this transaction is a clear win-win for everyone who owns a stake in either company," said David Crane, president and CEO of NRG. "With this important milestone completed, we will continue our intense focus on completing the merger, executing on the synergies and creating the first truly 21st century energy company for the benefit of our customers and our shareholders."
Edward R. Muller, chairman and CEO of GenOn added that the company is eager to begin working with NRG, and that it looks for to the "prompt receipt of the remaining approvals," which will enable the stakeholders of the combined company to start seeing major cost savings and efficiency, which will be directly attributed to the merger.
When the deal is complete, the new company will be one of the largest competitive electricity generators in the country. Between the resources of NRG and GenOn, the merged company will boast about 47,000 megawatts of generating capacity. The new firm will offer a broad range of electricity sources, with a portfolio that ranges from fossil fuels to renewable energy sources like solar and wind. Other options include clean energy, such as nuclear, which will help power the more than 37 million homes that receive their electricity from both companies.
Before the merger was completed, the Federal Trade Commission gave permission for an early termination of the Hart-Scott-Rodino waiting period, while the Public Utility Commission of Texas approved the deal. The deal is all but complete, with only regulatory approvals from the Federal Energy Regulatory Commission and the New York Public Service Commission remaining.
The joined company will be a huge force in the retail energy markets of states with energy deregulation laws in place. These include Texas, New Jersey, Illinois, Pennsylvania and several more, all of which have seen several retail energy providers crop up shortly after the laws were passed.