Duke Energy Corp. and Progress Energy Inc. have agreed to merge through a stock-for-stock transaction and assumption of existing debt. We are placing the 'BBB+' corporate credit and issue ratings on Progress Energy Inc., Carolina Power&Light Co. (dba Progress Energy Carolinas Inc.), and Florida Power Corp. (dba Progress Energy Florida Inc.) on CreditWatch with positive implications to reflect the likely upgrade following the completion of the transaction. We are affirming the 'A-' ratings on Duke Energy Corp. and the outlook remains stable. Duke is expected maintain credit quality through the merger-approval process and could show financial improvement post-merger depending on the terms of the regulatory approvals and the success of integration efforts. The combined entity would have an
