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Integrys Energy, Wisconsin Energy Offer Pro Rata Dividend - Analyst Blog

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The board of directors of Integrys Energy Group TEG has declared a special pro rata dividend for its shareholders in order to ensure that they continue to receive dividend until the closing of its merger with Wisconsin Energy Corp. WEC. The pro rata dividend is pegged at a daily rate of 0.7234 cents per share, which will accrue from May 30, 2015 until and including the day prior to the effective day of the merger.

This pro rata dividend is the daily equivalent of the current quarterly dividend rate of 68 cents per share. It will be paid to Integrys shareholders of record at the close of business on the day prior to the effective date of the merger, which is currently unknown but could occur by the end of this summer.

The declared pro rata dividend is contingent upon the completion of the merger prior to Aug 31, 2015, which is the dividend record date for Integrys.

Pro rata Dividend from Wisconsin Energy

Last Friday, the board of directors of Wisconsin Energy also announced a pro rata dividend of 0.459239 cents a share per day. It will accrue from May 15, 2015, until the day before the effective date of the acquisition. This pro rata dividend, which is the daily equivalent of the current quarterly dividend of 42.25 cents per share, would be payable to Wisconsin Energy shareholders at the close of business on the day preceding the effective date of the acquisition.

The board of Wisconsin Energy also declared a pro rata dividend of 0.497283 cents a share per day that will accrue from the effective date of the acquisition through Aug 14, 2015, which is the normal record date for Wisconsin Energy.

This pro rata dividend is the daily equivalent of the new quarterly dividend of 45.75 cents, representing an increase of 8.3% over the current rate. It will be paid on Sep 1, 2015 to Wisconsin Energy shareholders of record on Aug 14, 2015.

These pro rata dividend payments announced by the board of Wisconsin Energy are contingent on the completion of the merger before Aug 15, 2015. If the merger deal does not close by that date, Wisconsin Energy shareholders of record on Aug 14, 2015 will receive the current quarterly dividend of 42.25 cents per share, payable on Sep 1, 2015.

Merger Update

So far, Wisconsin Energy has received approvals from the utility commissions of Wisconsin, Minnesota and Michigan as well as several federal agencies for the merger, leaving only Illinois to approve the deal. The company expects the Illinois Commerce Commission’s decision on Jun 24.

As previously announced, the newly formed entity, WEC Energy Group, will pay a quarterly dividend of 45.75 cents in order to bring Integrys and Wisconsin Energy shareholders to dividend parity as per the merger agreement.

Currently, Integrys Energy holds a Zacks Rank #4 (Sell), while Wisconsin Energy has a Zacks Rank #3 (Hold). Investors interested in the utility sector may consider Huaneng Power International, Inc. HNP and RWE AG RWEOY. Both stocks sport a Zacks Rank #1 (Strong Buy).

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WISC ENERGY CP (WEC): Free Stock Analysis Report
 
INTEGRYS ENERGY (TEG): Free Stock Analysis Report
 
HUANENG POWER (HNP): Free Stock Analysis Report
 
RWE AG -SP ADR (RWEOY): Free Stock Analysis Report
 
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