According to a report by Bloomberg, Westar Energy Inc WR is a potential takeover target from rival Ameren Corp AEE and a consortium of investors, including Toronto-based Borealis Infrastructure Management and the Canada Pension Plan Investment Board.
Westar oversees more than 30,000 miles of electrical transmissions and 700,000 customers.
Bloomberg, citing "people familiar with the matter," noted that Westar is working with bankers to field interest in a sale and would begin evaluating bids next week. The publication added that Westar entertaining a sale for itself is consistent with recent heavy M&A activity within the utilities market.
Meanwhile, pension funds and infrastructure investors find utilities attractive given the stable and predictable returns.
Shares of Westar Energy surged to an intra-day of $52.82 – also corresponding to a 52-week high following the report. With less than two hours of trading remaining, the stock gave up most of the gains and were trading at $50.70, up 1.95 percent on the day.
Ameren's stock was also volatile following Bloomberg's report. The stock hit an intra-day of $51.00 – just six cents short of its 52-week high – and quickly gave up all of its gains. Shares were trading nearly flat for the day at $49.11 with less than two hours of trading.
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