Monday’s announcement of a newly redrawn merger of Westar Energy and Great Plains Energy companies in Kansas saw stocks plunge as investors reacted to the news.
Stock in Westar Energy dropped $2.75 a share, an indication that investors had expected a premium out of the deal rather than a stock-for-stock situation according to a report in the Topeka Capital Journal.
It might even be an indication how investors will vote when it comes time for the merger to be approved by them. The Kansas Corporation Commission also has to give its approval to the merger.
The new deal is a result of the KCC’s rejection a few months ago of another merger arrangement between the two companies. In the earlier and original proposed merger, the price tag was $12.2 billion and Great Plains Energy would have paid $60 a share to Westar stockholders. The payout would have been $51 in cash and $9 in stock.
