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Having correctly predicted that Exelon Corp.’s (NYSE:EXC) attempted takeover of NRG Energy Inc. (NYSE:NRG) would fail and that both firms’ share prices would then rise (See Prediction: Exelon’s NRG Takeover Bid Will Fail; Both Firms Will Then See Their Stock Prices Rise), Daniel Scotto of HFP Capital Markets is back with another eye-catching observation.

Scotto, the veteran electric utility and energy analyst, thinks Dynegy Inc. (NYSE:DYN), the big independent power generator, could become a takeover candidate, and that NRG or Exelon could become its suitor.

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To be sure, investors shouldn’t think such a deal is definite or even probable. Scotto himself says there is only a 60-40 chance that an offer will be forthcoming.

But the analyst’s reasons for why such a deal could occur are worth noting.

In an interview late last week, Scotto recalled that NRG said in a regulatory filing last fall that it had been thinking about going after Dynegy until it became the target of Exelon. Scotto added that if NRG thought Dynegy was worth a look-see back then, it may well still think so, given that Dynegy’s stock price has since declined, thus presumably making the company an even better value today.

Scotto then noted that in a recent article in the Chicago Tribune Exelon CEO John Rowe indicated he was still in the hunt for a company to acquire. “We’ll keep looking for something we can do. The industry needs consolidation,” the Tribune quoted Rowe as saying. “So why,” Scotto rhetorically asked, “doesn’t Exelon go after Dynegy?”

As for why there is a 40% chance no offer for Dynegy may be forthcoming, Scotto said that cash generally is tight and that the acquisition would not be immediately accretive to earnings.

But then he further stirred the pot by noting, “I’m sure others will be looking at” Dynegy.

Disclosure: No positions

Source: Dynegy as a Takeover Candidate: Will NRG or Exelon Be Suitor?