Backed by state leaders, Charlotte, N.C.-based Duke Energy (NYSE:DUK) on Monday rejected hedge fund Elliott Management’s proposal to break up the company into three regionally focused, publicly traded utilities.

Elliott — whose management of funds invested in Duke make it one of the company’s top 10 investors, it claims — released an open letter to Duke’s board of directors on Monday critical of the company’s performance. It suggested that the board create three utilities, each with its own board and management, the Carolinas, Florida and the Midwest.

The separation “should create $12 [billion] to $15 billion of line-of-sight near-term value for shareholders,” the letter argued. Elliott manages about $42 billions in funds.

Duke within hours issued its response: No.

“Today’s announcement by Elliott is the latest in a series of proposals that the hedge fund has offered to Duke Energy since July 2020, the company said. “Throughout, Duke Energy’s board of directors has reviewed their proposals in depth and determined that they are not in the best interests of the company, its shareholders and other stakeholders.”

Following the release of Elliott’s letter, Duke’s share price fell 2.4% over three days, closing Wednesday at $101.16, down from Friday’s close of $103.60. Usually, utilities targeted by Elliott see a gain in share price.

The essence of Elliott’s argument is that for its size — nearly 8 million electric customers in six states — Duke should be earning much more than it has over the last several years.

Elliott’s idea would make Duke’s Florida utility a separate company and create another company consisting of operations in Indiana, parts of Ohio and parts of Kentucky.

To accomplish this split, Elliott also suggested that the board create an “independent board committee, including new highly qualified independent directors, and assisted by independent outside advisers.” The hedge fund noted that it “has worked with major utilities in similar circumstances, collaborating with directors and management teams to deliver dramatic improvements in operating performance, enhance portfolio configuration and unlock shareholder value.”

In its response Duke pointed out that Elliott had initially suggested that the company issue “up to $7 billion of common equity … to Elliott, essentially transferring up to 10% of Duke’s value to Elliott.” The company rejected that.

Elliott then proposed the company spin off its Florida and Midwest operations, according to Duke.

“This ‘shrink-the company’ strategy that underlies all of Elliott’s proposals runs counter to the strategic direction of the entire industry at a time when scale is needed to efficiently finance the company’s unprecedented capital investment and growth opportunities,” Duke explained its opposition to that idea.

Elliott then demanded an unspecified number of new board seats as well as the initiation of a “strategic review” without further explaining the purpose of that review, according to Duke’s statement.

The fund’s letter spurred multiple responses from North Carolina, South Carolina and Indiana state officials, all in support of Duke.

“Beyond the pride of a home-state company, though, is the reality that Duke delivers reliable, cost-effective energy to millions of North Carolinians,” North Carolina Gov. Roy Cooper said in a joint statement with leaders of both houses of the state legislature. “There are natural concerns that come with putting our state’s energy future in the hands of a Wall Street hedge fund, and we would expect the North Carolina Utilities Commission to strictly scrutinize any such arrangement.”