Black Hills Corp. (NYSE:BKH) dropped 3.6% to $58.20 in Tuesday’s premarket session after unveiling an all-stock merger with NorthWestern Energy Group (NASDAQ:NWE).
The transaction, approved unanimously by both companies’ boards, will form a regulated utility player with a combined market capitalization of about $7.8 billion and an enterprise value of $15.4 billion. NorthWestern shares, which last closed at $54.93 on Monday, were temporarily halted before the news.
According to the deal’s terms, NorthWestern investors will receive 0.98 shares of Black Hills for each share they own, reflecting a 4% premium based on volume-weighted averages since merger discussions began in March 2025. Once finalized, Black Hills shareholders will control roughly 56% of the combined entity, with NorthWestern holders owning the other 44%.
Executives project that the merger will add to both companies’ earnings per share within the first year after closing. The larger utility is aiming for long-term EPS growth between 5% and 7%, exceeding the standalone outlooks of either firm.
“The combined company will have greater scale and financial strength to consistently deliver for customers across our service territories and invest at the pace and scale that today’s energy transformation demands,” said Linn Evans, President and CEO of Black Hills.
The merged utility is expected to serve about 2.1 million customers across eight neighboring states with a rate base of approximately $11.4 billion. Current capital investment plans for 2025–2029 exceed $7 billion.
Once the deal is complete, NorthWestern’s Brian Bird will take on the role of CEO, with corporate headquarters located in Rapid City, South Dakota. Closing is anticipated within 12–15 months, subject to shareholder and regulatory approvals.
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