What Does Vectren Merger Mean?

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(Service area map provided by Vectren.) (Service area map provided by Vectren.)
EVANSVILLE -

A utility industry observer says he does not think the planned $6 billion merger of Evansville-based Vectren Corp. (NYSE: VVC) and CenterPoint Energy Inc. (NYSE: CNP) will have a major impact in Indiana. Doug Gotham, who serves as director of the State Utility Forecasting Group at Purdue University, also says he is not aware of any recent mergers that have been shut down by Federal Energy Regulatory Commission, a key hurdle that remains to be cleared. CenterPoint says plans call for the combined combined company's natural gas utility operations to be headquartered in Evansville, which will also be home to its lead executives.

"I don't know that it's a done deal," Gotham told Inside INdiana Business. "As with any corporate merger, I think there are things that would have to be approved at the federal level."

He discussed the potential ramifications of the merger within the state. "I don't know that it will have a whole lot of impact -- at least right away," Gotham said. "There may be changes over time in what I might call corporate philosophy -- the kinds of things that they tend to value." As a hypothetical, Gotham says Vectren has always focused on using Indiana coal for its generation needs, whereas an out-of-state owner might not have the same focus. The merger is slated to close in the first quarter of 2019.

CenterPoint also intends to retain utility field employees and key utility operational support activities in Evansville. Vectren currently employs 5,500 and CenterPoint's work force is close to 8,000. The companies' combined customer footprint includes nearly three dozen states.

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