Cleco To Be Acquired By Investor Group For $3.4 Bln - Update

(RTTNews) - Utility Cleco Corp. (CNL) Monday said it has agreed to be acquired by an investor group led by Australia's Macquarie Group Ltd. for $3.4 billion. The shares of Pineville, Louisiana-based power company is currently up over 10 percent, following the news.

The investor group has agreed to pay shareholders of Cleco $55.37 in cash for each share held, which represents a premium of about a 15 percent to Cleco's closing price of $48.27 on October 17, the last trading day prior to announcement. The total acquisition price aggregates about $3.4 billion, and the investor group will also assume $1.3 billion of debt.

The acquisition is expected to close in the second half of 2015, subject to customary closing conditions, including the approval of Cleco shareholders, the Louisiana Public Service Commission and the Federal Energy Regulatory Commission.

The investor group includes Macquarie Infrastructure and Real Assets,and British Columbia Investment Management Corp., John Hancock Financial and other infrastructure investors.

Under the agreement announced today, the buyers will keep a presence in Pineville, maintain rates and employee headcount and put at least four Louisiana residents on the board.

Cleco will continue to operate as an independent company led by local management and will maintain its headquarters in Pineville. The transaction will not affect residential or commercial rates for electricity, the company said in a statement.

"With this agreement, Cleco's existing investors will receive an exceptional value for their shares to top off a superior total shareholder return of the past few years, and our customers and employees can expect us to retain our strong commitment to service and reliability," said Bruce Williamson, Cleco's chairman, president and chief executive officer.

CNL is currently trading at $53.16, up $4.89 or 10.13%, on the NYSE.