Black Hills Corporation and NorthWestern Energy Corporation have entered into a definitive agreement under which… They will combine in an all-stock, tax-free agreement that envisions remaking the energy habitat from Coast to Coast. Together, this strategic move will create a combined company worth $15.4 billion. It will have a highly speculative pro forma market capitalization of $7.8 billion. As some news reports have noted, they expect to complete the merger in 12 to 15 months. This timeline is contingent upon receipt of the required regulatory approvals and shareholder consents.
Per the terms of the merger agreement, Black Hills investors will own 56% of the new combined company. Meanwhile, shareholders of NorthWestern will continue to own approximately 44% of the combined company. The combined company will now serve more than two million customers over eight states, greatly bolstering its potential reach and economies of scale.
Leadership Structure and Headquarters
The new merged entity will have a board of directors consisting of six members from Black Hills and five members from NorthWestern. This structure ensures that both companies have equal representation to all points. The headquarters for this newly established utility will be located in Rapid City, South Dakota, positioning it strategically to manage operations effectively across its service territories.
At the time, Linn Evans, president and CEO of Black Hills, was excited about the merger. “The combined company will be a much greater scale and financial strength,” he said. “This will allow us to deliver the most for customers across our combined service areas and invest more rapidly and efficiently in today’s energy transformation.
Investment Plans and Infrastructure Development
Both companies have extensive joint investment plans, more than $7 billion from 2025 to 2029. This investment will focus on critical infrastructure improvements in electricity and natural gas sectors, addressing the growing energy needs of consumers while maintaining competitive rates.
Brian Bird, then president and CEO of NorthWestern Energy, touted the promise of the merger. He continued, “Together, we will be better equipped to address increasing demand, speed up investment in energy and grid infrastructure, and help customers and communities navigate a changing energy ecosystem.”
Regulatory Approval and Future Prospects
Completion of the merger is subject to receiving clearance under the Hart-Scott-Rodino Act as well as required shareholder approvals and regulatory consents. In December 2024, NorthWestern Energy jointly-owned the proposed North Plains Connector HVDC transmission line. This smart strategy gets the company in a strong position to serve the growing energy demands of the future.
