CH Energy Up 12% After Buyout Offer

Shares of CH Energy Group

are up 12% after the company announced that it would be acquired for $1.5 billion. The company today announced that it has entered into a definitive merger agreement with Fortis Inc., the largest investor-owned distribution utility in Canada, under which Fortis will acquire CH Energy Group for an aggregate purchase price of approximately U.S. $1.5 billion, including the assumption of approximately U.S. $500 million of debt. The all-cash transaction will provide U.S. $65 per share to common shareholders of CH Energy Group, parent company of Central Hudson Gas & Electric Corporation, an approximate 10.5 percent premium above CH Energy Group's closing stock price on February 17, 2012, the last trading day before the announcement; a premium of 13.1 percent above its most recent 20-day trading average of $57.49; and approximately 10.4 times its 2011 EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization). Subject to regulatory approvals and other customary closing conditions, the transaction is expected to close in the first quarter of 2013.