Remember a few weeks ago when news broke that Duke Energy (DUK) rejected a takeover offer from NextEra Energy (NEE)? Well, NEE isn't going to let their overpriced stock go to waste!
News came out today that NEE has approached Evergy (EVRG) about a merger. EVRG was formed in 2017-ish when Great Plains (GXP) merged with Westar (WR). The renamed the combined entity "Evergy" and changed the ticker. It's basically a pure-play Kansas utility. Mostly electric, though it does have some gas customers. It would be a great place to get a foothold and build more wind power and transmission lines - and continue to cut costs. The Kansas regulators took a pound of flesh in the WR/GXP deal and would love to get another cut in any coming deal too. NEE has one of the most expensive utility valuations and using that currency is completely logical.
I took a small a position in EVRG on the news - and am surprised the stock didn't react more today. It might be a good one to buy calls on, as any official news that gets released would undoubtedly push the shares higher...and stay protected if the news doesn't come. Perhaps a December expiration?
Just wanted to share this news with you as it could be a big mover in the coming weeks.
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