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UPDATE 1-Regulated power company Great Plains to buy Westar for $8.6 bln

Published 2016-05-31, 06:30 a/m
© Reuters. UPDATE 1-Regulated power company Great Plains to buy Westar for $8.6 bln
GS
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(Adds details)
May 31 (Reuters) - Great Plains Energy Inc GXP.N , the
parent of regulated power utility Kansas City Power & Light,
will buy rival Westar Energy Inc WR.N for $8.6 billion in cash
and stock as it looks to gain scale to better compete in a
challenging market.
Westar shareholders will receive a total of $60 per share,
representing a premium of 13.4 percent to the stock's Friday
close.
The deal comes at a time when U.S. utilities are struggling
with falling demand for electricity in both open and regulated
markets due to increased energy efficiency and a weak economy.
The enterprise value of the deal is about $12.2 billion,
including about $3.6 billion in Westar's debt, the companies
said on Tuesday.
The transaction will increase Great Plains Energy's customer
base to more than 1.5 million in Kansas and Missouri, with
nearly 13,000 megawatts of generation capacity.
Great Plains Energy has secured about $8 billion of
committed debt financing from Goldman Sachs.
Goldman Sachs & Co (NYSE:GS) is Great Plains Energy's financial
adviser for the deal and Bracewell LLP is its legal adviser.
Guggenheim Securities LLC is as Westar's financial adviser
and Baker Botts LLP is its legal counsel.

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