Energy company Duke Energy Corp. said Monday it agreed to purchase another power company, Cinergy Corp., for about $9 billion to diversify its fleet of power plants in the Midwest.

"It’s a great marriage of our Midwest facilities that we hold in DENA with their Midwest facilities. They are short power in the Midwest, we are long power in the Midwest. They are heavily dependent on coal, we are 100 percent gas," said Duke Chief Executive Paul Anderson.

Cinergy, a smaller power company, will be able to expand on the market after the merger as Duke expects its merchant energy business DENA to grow after being combined with Cinergy’s own merchant fleet.

Cinergy will also bring its retail customers in Ohio, Indiana and Kentucky to Duke. Under the terms, Cinergy’s coal-fired power generation fleet will complement Duke’s gas-fired plants in the Midwest and receive more capacity in the peak periods.

Duke offers $45.80 for each Cinergy share, it is a 13% premium to Cinergy’s closing share price of $40.38 a share on Friday. Cinergy’s shareholders will receive about 24% of the combined company, Duke shareholders will own the remaining 76%, according to the statement.

Duke says the deal may result in $400-million annual savings for Charlotte, North Carolina-based company.