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The Pain in Spain Is Your Gain

Stop worrying about Europe's debt crisis and start profiting from it, Cramer said on Thursday's Mad Money.

UIL Holdings is an American utility company that recently announced it is buying assets from a Spanish company at a great price, Cramer explained. The New Haven, Conn.-based utility said Tuesday it will purchase three regulated gas local distribution companies in New England from Iberdrola SA, which is desperately raising money to pay its debt down.

UIL is paying $1.3 billion in cash, less debt of $411, million for the assets that will more than double its customer base from 325,000 to 694,000 people. That growth is significant, Cramer said, because the utility industry is too heavily regulated for most companies to be able to grow the size of their business. He also said this deal is a transformational one for UIL it will change the pure-play electric utility into one that also deals in natural gas. And regular viewers of Mad Money know how bullish Cramer is on nat gas.

The Iberdrola deal is expected to provide enhanced cash flow per share to UIL immediately upon consummation of the agreement, Cramer said. It will be additive to earnings in 2012, which is the first full year after the closing. Another benefit is that Cramer thinks the deal will ultimately provide UIL cost savings, so analysts earnings estimates may prove too low.

Not only is UIL an accidentally high-yielding company, it has a big 7.2% dividend yield. Cramer thinks the deal will help provide support for the dividend in the future, possibly allowing it to grow in the future.

So how do you play it? With the coming secondary offer, Cramer said. A $700 million company, UIL is doing a $500 million secondary offering to finance the deal. The equity offering will likely lower the price, so buying on there gets you a better entry point, and a higher yield once the deal is complete.

"If you can't get in on the secondary, take a pass," Cramer said. "We'll find another high-yielding opportunity for you at another time."

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com

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UIL
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