Jim Cramer Suggests Against Holding Dominion (D) Through the NextEra (NEE) Share Conversion

On the September 16 episode of Mad Money, Jim Cramer made it clear that he does not recommend holding Dominion Energy (D) shares while NextEra Energy (NEE) is undergoing a share conversion. Cramer advised investors to take their money and run, stating that NextEra Energy is a superior stock to own. The two companies, Dominion Energy and NextEra Energy, are set to merge in an all-stock transaction valued at around $67 billion.

Under the terms of the deal, Dominion shareholders will receive 0.8138 shares of NextEra Energy for each share they hold, along with a $360 million cash payment spread across outstanding Dominion shares at closing. The combined company will serve approximately 10 million customer accounts across high-growth regions, including Florida, Virginia, North Carolina, and South Carolina.

However, the merger faces regulatory hurdles, particularly in Virginia, and both companies have substantial debt levels. Despite this, interest from hedge funds remains strong for both NEE and D, with 80 funds holding NEE and 47 holding D as of the second quarter.