Dynegy Agrees to Acquire Enron
Dynegy Inc. (Houston, TX) agreed to acquire rival Enron Corp. (Houston, TX) for about $9.5 billion. Terms of the transaction call for Dynegy to swap 0.2685 shares of its own stock for each Enron share. That would value Enron at $10.41 per share, including convertible stock.
ChevronTexaco Corp. (San Francisco, CA), which owns a 27-percent stake in Dynegy, has agreed to infuse $1.5 billion into Enron to support it until the deal closes. ChevronTexaco will inject another $1.0 billion into the merged company once the deal closes.
Enron has been struggling to overcome a plummeting stock price and credit ratings in the past month following disclosures of off-balance sheet deals now under investigation by the US Securities and Exchange Commission for possible conflicts of interest.