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Great Plains, Black Hills acquire Aquila properties
By Lisa Kerner
Charlotte, N.C., July 14 - Great Plains Energy Inc. and Black Hills Corp. closed their asset purchase and merger of Aquila, Inc. on Monday, effective at 1:01 a.m. ET.
Black Hills acquired five of Aquila's natural gas and electric utilities in Colorado, Iowa, Kansas and Nebraska for $940 million in cash.
The purchase price, subject to final closing adjustments, was financed through $380 million of borrowings under the company's $1 billion acquisition facility. Black Hills also used cash proceeds from the July 11 sale of seven independent power production facilities, a company news release stated.
"With this transaction, the company is building a platform for growth based on a foundation of stable cash flow, more predictable earnings and increased efficiencies," Black Hills chairman, president and chief executive officer David R. Emery said in the release.
"It complements the company's existing businesses and substantially broadens Black Hills' regional presence and utility operations," Emery added.
According to Emery, the Aquila transaction more than doubles the number of Black Hills employees and increases the company's utility customer base five-fold.
The acquired Aquila utilities will operate under the name Black Hills Energy.
Great Plains acquired all the outstanding shares of Aquila and its Missouri-based electric utility assets for $1.80 in cash plus 0.0856 of a share of Great Plains Energy common stock for each share of Aquila common stock.
The transaction was valued at $4.54 per share, or about $1.7 billion, and included the assumption of Aquila's net debt of approximately $1.7 billion when first announced in February 2007.
Based in Kansas City, Mo., Aquila owns electric power generation assets and operates electric and natural gas transmission and distribution networks.
Black Hills is a diversified energy company based in Rapid City, S.D.
Great Plains Energy is the Kansas City, Mo., holding company for Kansas City Power & Light and Strategic Energy, LLC.
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