Newly formed Evergy initially will serve customers under familiar
Westar, KCP&L brands
KANSAS CITY, Mo. & TOPEKA, Kan.--(BUSINESS WIRE)--May 24, 2018--
Today, Great Plains Energy Incorporated (NYSE: GXP), which serves
customers as KCP&L, and Westar Energy, Inc., (NYSE: WR) received final
regulatory approval from the Kansas Corporation Commission (KCC) and
Missouri Public Service Commission (MPSC) to combine. The
stock-for-stock merger of equals creates a holding company of
approximately $15 billion equity value, which will be named Evergy, Inc.
(NYSE: EVRG). Its principal business will be conducted by the operating
companies known today as Westar and KCP&L.
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“As neighbors, KCP&L and Westar have served customers in Kansas and
Missouri for more than 100 years. This merger allows us to be even more
efficient as we continue providing excellent customer service while
maintaining competitive prices,” said Terry Bassham, chairman and chief
executive officer of Great Plains Energy, who will be president and CEO
of Evergy. “We appreciate that regulators and shareholders recognize the
value in combining the companies.”
The companies anticipate a closing date in early June, concluding a
two-year effort to combine the two companies.
The utilities have guaranteed more than $100 million in customer bill
credits with $29 million upfront for Missouri customers and $75 million
for Kansas customers over the first five years after the merger closes.
In addition, once currently pending rate reviews are resolved, the
companies have agreed to fix their base rates for up to five years in
Kansas as a result of the merger.
“Customers will benefit from bringing together two innovative teams of
employees who are active in the communities we serve and take pride in
providing excellent customer service. The increased scale and efficiency
will deliver savings not possible without the merger,” Bassham said.
Introducing Evergy
The companies selected Evergy, Inc. (Evergy) as the name to represent
their combined identity. Evergy is a blend of “ever” and “energy,”
capturing the history of its predecessors as reliable, enduring sources
of energy for the communities they serve and its vision to continue far
into the future.
For the immediate future, the company will continue to serve its
customers under the familiar Westar and KCP&L brand names. Contact
information, billing and account information, program enrollment and
outage reporting will remain the same for customers of KCP&L and Westar.
Financial strength
Evergy is expected to maintain a strong balance sheet and solid
investment grade credit profile. In addition to customer benefits,
merger efficiencies are expected to provide attractive total shareholder
returns through earnings and dividend growth. The company expects to
rebalance its capital structure by repurchasing about 60 million shares
of its common stock over a two-year period. More information on the
company’s plan to rebalance its capital structure will be provided on
Evergy’s August earnings webcast.
Serving customers
The combined company will serve approximately 1.6 million customers,
with a little under 1,000,000 in Kansas and 600,000 in Missouri. In
addition, the combined company will own, operate and maintain more than
51,000 miles of distribution lines and 13,000 megawatts of generation.
With corporate headquarters in Kansas City, Mo., and operational
headquarters in both Kansas City, Mo., and Topeka, Kan., Evergy will be
the parent of Westar Energy and of KCP&L and KCP&L Greater Missouri
Operations Company, which were previously part of Great Plains Energy.
Together, the company will employ about 5,000 employees across Kansas
and Missouri. Company executives will be located in Topeka, Wichita, and
Kansas City, and will continue to be engaged in these communities and
throughout the combined service territory.
Affordable, clean energy
With its focus on renewables, Evergy will meet nearly half of the energy
needs for the homes and businesses it serves with energy from
zero-emission sources. Nearly one-third will come from renewable energy,
making Evergy one of the largest wind energy providers in the nation. In
addition, the company is developing more ways to support customers and
communities with energy efficiency and additional renewable energy
programs.
Continued community commitment
KCP&L and Westar have long-standing traditions of supporting the
communities they serve. Evergy has committed to maintain that support.
Employees currently serve on more than 300 community, charitable and
volunteer boards. In addition, the companies and their employees donate
more than 35,000 hours and millions of dollars to community and
charitable organizations annually.
To learn more about the transaction, visit www.kcpl.com/westar
or, after close, www.evergyinc.com.
About Great Plains Energy
Headquartered in Kansas City, Mo., Great Plains Energy Incorporated
(NYSE: GXP) is the holding company of Kansas City Power & Light Company
and KCP&L Greater Missouri Operations Company, two of the leading
regulated providers of electricity in the Midwest. Kansas City Power &
Light Company and KCP&L Greater Missouri Operations Company use KCP&L as
a brand name. More information about the companies is available on the
internet at www.greatplainsenergy.com
or www.kcpl.com.
About Westar Energy
Westar Energy, Inc. (NYSE: WR) is Kansas' largest electric utility. For
more than a century, we have provided Kansans the safe, reliable
electricity needed to power their businesses and homes. Every day our
team of professionals takes on projects to generate and deliver
electricity, protect the environment and provide excellent service to
our nearly 700,000 customers. Westar has 7,200 MW of electric generation
capacity fueled by coal, uranium, natural gas, wind, sun and landfill
gas. We are also a leader in electric transmission in Kansas. Our
innovative customer service programs include mobile-enabled customer
care, expanding use of smart meters and paving the way for electric
vehicle adoption. Our employees live, volunteer and work in the
communities we serve. For more information about Westar Energy, visit us
on the Internet at http://www.WestarEnergy.com.
Forward-Looking Statements
Statements made in this press release that are not based on
historical facts are forward-looking, may involve risks and
uncertainties, and are intended to be as of the date when made.
Forward-looking statements include, but are not limited to, statements
relating to the anticipated merger transaction of Westar Energy, Inc.
(Westar Energy) and Great Plains Energy Incorporated (Great Plains
Energy), including those that relate to the expected financial and
operational benefits of the merger to the companies and their
shareholders (including cost savings, operational efficiencies and the
impact of the anticipated merger on earnings per share), the expected
timing of closing, the outcome of regulatory proceedings, cost estimates
of capital projects, dividend growth, share repurchases, balance sheet
and credit ratings, rebates to customers, employee issues and other
matters affecting future operations. In connection with the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995,
Evergy, Inc. (Evergy), Westar Energy and Great Plains Energy are
providing a number of important factors that could cause actual results
to differ materially from the provided forward-looking information.
These important factors include: future economic conditions in regional,
national and international markets and their effects on sales, prices
and costs; prices and availability of electricity in regional and
national wholesale markets; market perception of the energy industry,
Evergy, Great Plains Energy, KCP&L, and Westar Energy; changes in
business strategy, operations or development plans; the outcome of
contract negotiations for goods and services; effects of current or
proposed state and federal legislative and regulatory actions or
developments, including, but not limited to, deregulation, re-regulation
and restructuring of the electric utility industry; decisions of
regulators regarding rates that the companies can charge for
electricity; adverse changes in applicable laws, regulations, rules,
principles or practices governing tax, accounting and environmental
matters including, but not limited to, air and water quality; financial
market conditions and performance including, but not limited to, changes
in interest rates and credit spreads and in availability and cost of
capital and the effects on derivatives and hedges, nuclear
decommissioning trust and pension plan assets and costs; impairments of
long-lived assets or goodwill; credit ratings; inflation rates;
effectiveness of risk management policies and procedures and the ability
of counterparties to satisfy their contractual commitments; impact of
terrorist acts, including, but not limited to, cyber terrorism; ability
to carry out marketing and sales plans; weather conditions including,
but not limited to, weather-related damage and their effects on sales,
prices and costs; cost, availability, quality and deliverability of
fuel; the inherent uncertainties in estimating the effects of weather,
economic conditions and other factors on customer consumption and
financial results; ability to achieve generation goals and the
occurrence and duration of planned and unplanned generation outages;
delays in the anticipated in-service dates and cost increases of
generation, transmission, distribution or other projects; the inherent
risks associated with the ownership and operation of a nuclear facility
including, but not limited to, environmental, health, safety, regulatory
and financial risks; workforce risks, including, but not limited to,
increased costs of retirement, health care and other benefits; the
imposition of adverse conditions or costs in connection with obtaining
regulatory approvals necessary to complete the anticipated merger; the
risk that a condition to the closing of the anticipated merger may not
be satisfied or that the anticipated merger may fail to close; the
outcome of any legal proceedings, regulatory proceedings or enforcement
matters that may be instituted relating to the anticipated merger; the
costs incurred to consummate the anticipated merger; the possibility
that the expected value creation from the anticipated merger will not be
realized, or will not be realized within the expected time period;
difficulties related to the integration of the two companies; the credit
ratings of the combined company following the anticipated merger;
disruption from the anticipated merger making it more difficult to
maintain relationships with customers, employees, regulators or
suppliers; the anticipated diversion of management time and attention on
the anticipated merger; and other risks and uncertainties.
This list of factors is not all-inclusive because it is not possible
to predict all factors. Additional risks and uncertainties are discussed
in the joint proxy statement/prospectus and other materials that Great
Plains Energy, Westar Energy and Evergy file with the Securities and
Exchange Commission (SEC) in connection with the anticipated merger.
Other risk factors are detailed from time to time in quarterly reports
on Form 10-Q and annual reports on Form 10-K filed by Great Plains
Energy and Westar Energy with the SEC. Each forward-looking statement
speaks only as of the date of the particular statement. Evergy, Westar
Energy and Great Plains Energy undertake no obligation to publicly
update or revise any forward-looking statement, whether as a result of
new information, future events or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180524006453/en/
Source: Great Plains Energy
Great Plains Energy
Investors
Calvin Girard,
816-654-1777
Senior Manager, Investor Relations
calvin.girard@kcpl.com
or
Media
Courtney
Hughley, 816-590-8973
Senior Manager, Corporate Communications
Courtney.Hughley@kcpl.com
or
Great
Plains Energy media line:
816-392-9455
or
Westar Energy
Investors
Cody
VandeVelde, 785-575-8227
Director, Investor Relations
Cody.VandeVelde@westarenergy.com
or
Media
Gina
Penzig, 785-575-8089
Media Relations Manager
Gina.Penzig@westarenergy.com
or
Media
line: 888-613-0003
