LG&E ENERGY CORP. TO BE ACQUIRED BY POWERGEN PLC IN $3.2 BILLION CASH
TRANSACTION
LOUISVILLE, Ky., Feb 28, 2000 /PRNewswire via COMTEX/ -- LG&E Energy
Corp. (NYSE: LGE) today announced it has signed a definitive merger
agreement with PowerGen plc, under which PowerGen will acquire all of
the outstanding shares of LG&E Energy in an all-cash transaction valued
at $3.2 billion.
LG&E Energy will become the headquarters of PowerGen's operations in
the U.S., providing PowerGen with an entry into the U.S. energy market
and a strong platform for future growth.
Under the terms of the agreement, LG&E Energy shareholders will receive
$24.85 in cash for each share held. The purchase price represents a
premium of 58 percent above the closing price of LG&E Energy shares on
Feb. 25, 2000.
PowerGen is one of the world'ce operating generation and distribution
assets in a competitive market. The company is listed on the London
Stock Exchange with a market capitalization of $4.1 billion.
The combined company will have assets of nearly $12 billion and total
revenues of $8.7 billion. It will serve nearly four million customers
worldwide, with a work force of more than 13,000. It will have business
operations on five continents and the Indian sub-continent, including
20 Gw of generation capacity and more than 64,000 miles of transmission
and distribution infrastructure.
"This transaction provides tremendous value for our shareholders,
customers, employees and the Commonwealth of Kentucky," said Roger W.
Hale, LG&E Energy chairman and chief executive officer. "It is an
outstanding opportunity for the company to enhance shareholder value.
It also preserves LG&E Energy's strong presence as a major corporation
in the state. As a result, we will continue our longstanding commitment
to economic development, charitable giving and community involvement
throughout the Commonwealth. LG&E Energy remains committed to ensuring
our customers benefit from some of the lowest rates in the nation and
our dedicated employees will continue to provide the award-winning
quality of service our customers have come to expect."
"This deal is a very exciting one for PowerGen, its shareholders and
employees. Buying LG&E secures a stream of high quality, stable
earnings which support shareholder value in the short term whilst
providing us with the opportunity to grow our earnings in the future.
Of all the opportunities we have looked at, this is the one that has
the greatest potential. We are delighted to have agreed this deal with
Roger and his team, with whom we have already developed excellent
working relationships," said Ed Wallis, chairman and chief executive of
PowerGen.
Roger W. Hale will remain chairman and chief executive officer of LG&E
Energy and will join the PowerGen board of directors in London. LG&E
Energy's current management team and structure will remain in place.
LG&E Energy's union contracts will not be affected by the transaction.
Upon completion of the acquisition, LG&E Energy will become a wholly
owned subsidiary of PowerGen. LG&E Energy and its subsidiary names will
remain the same, and the company's headquarters for U.S. operations
will remain in Louisville, Ky. PowerGen's American Depositary Receipts
(ADR) will continue to be listed on the New York Stock Exchange, with
each representing four ordinary shares.
The transaction is subject to approval by the shareholders of each
company, 'as well as the U.S. Securities and Exchange Commission,
Federal Energy Regulatory Commission, the Kentucky Public Service
Commission and the Virginia State Corporation Commission.
The transaction is also subject to approval under the Hart-Scott-Rodino
Act. The acquisition is expected to close within approximately nine to
12 months.
LG&E Energy Corp., headquartered in Louisville, Ky., is a Fortune 500
diversified energy services company with businesses in power generation
and project development; retail gas and electric utility services; and
asset-based energy marketing. It has been ranked by J.D. Power and
Associates as highest in customer satisfaction with residential
electric service in the Midwest. In addition, LG&E Energy ranked
highest among all electric service companies ranked in the nation.
The company owns and operates Louisville Gas and Electric Company, a
regulated electric and gas utility serving 16 Kentucky counties, and
Kentucky Utilities Company, a regulated electric utility, based in
Lexington, Ky., which serves 77 Kentucky counties and five counties in
Virginia. LG&E Energy also owns interests in and operates non-utility
power plants in six states as well as in Spain; owns interests in three
natural gas distribution companies in Argentina; and owns CRC-Evans
Pipeline International Inc., the world's leading provider of specialty
equipment and services to the natural gas and oil pipeline construction
industry.
PowerGen is a British company and one of the world's major power
businesses. It is one of the UK's leading integrated gas and electric
companies, generating about 14 percent of the electricity needs of
England and Wales. The company has a growing retail customer base of
over 2.6 million customer accounts, is the market leader in provision
of large scale combined heat and power plant and in the industrial and
commercial electricity market. The UK business is split into five
divisions: generation, distribution, combined heat and power and
distribution.
Statements made in this release that state the Company's or
management's intentions, expectations or predictions of the future are
forward-looking statements. The Company's actual results could differ
materially from those projected in the forward-looking statements, and
there can be no assurance that estimates of future results will be
achieved. The Company's SEC filings contain additional information
concerning factors that could cause actual results to differ materially
from those in the forward-looking statements.
Internet Resources
LG&E Energy Corp. www.lgeenergy.com
PowerGen plc www.pgen.com |
