Former Progress Energy CEO Bill Johnson told the North Carolina Utilities Commission (NCUC) on July 19 that he believes Duke Energy (NYSE: DUK) wanted to back out of the merger agreement it had made with Progress.
“I was convinced he was trying to walk out of the deal,” Johnson said of Jim Rogers, now president and CEO of Duke Energy.
According to Johnson, the merger process “started to go downhill” at the end of December 2011 after the companies received an order from FERC rejecting their market mitigation plan.
“The relationship between Mr. Rogers and I deteriorated,” Johnson said. “It was very apparent to me that the Duke management had had a change of heart when they started looking at what the mitigation plan at FERC costs, about whether they wanted to do this deal.”
Johnson was supposed to become president and CEO of the combined company, and Rogers was going to be executive chairman, adviser to Johnson and lead spokesman on energy policy, as approved by North Carolina regulators on June 29. However, when Duke Energy announced the news of the merger on July 3, the company said in a press release that “Johnson has resigned as president and chief executive officer of the combined company, by mutual agreement.”
The NCUC launched an investigation into the matter a result of the last-minute switch and the $44 million severance package that Duke offered Johnson.
On July 10, Rogers testified before the NCUC, saying of Johnson that the “board did not feel his style was appropriate or transferrable to leadership of the combined company.”
During his testimony on July 19, Johnson said, “If the Duke board had concerns, they could have talked to me about them. None of the board's concerns Rogers testified about last week were ever expressed to me.”
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