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Westar reportedly drawing takeover interest from Ameren, Canadian investors

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Westar reportedly drawing takeover interest from Ameren, Canadian investors

Kansasutility Westar Energy Inc.is drawing takeover interest from AmerenCorp. and a Canadian investor consortium made up of Toronto-basedBorealis InfrastructureManagement and the CanadaPension Plan Investment Board, Bloomberg News reported April 8,citing "people familiar with the matter."

Bloombergreported that Westar is working with Guggenheim Partners LLC to field interestfor the utility, with initial bids due the week of April 11. Westar's marketvalue is believed to be approximately $7 billion.

Inearly March, Bloomberg reported that Westar was in the early stages ofexploring strategic alternativesfor the company, including a sale.

AWestar representative has told S&P Global Market Intelligence that thecompany does not comment on speculation. Ameren, headquartered in St. Louis,did not immediately respond to a request for comment. A Westar acquisitionwould allow the company, which serves approximately 2.4 million electriccustomers and more than 900,000 natural gas customers in Illinois and Missouri,to expand into neighboring Kansas.

Apotential Westar deal could also follow a trend of U.S. utilities being acquired by Canadiancompanies.

St.John's, Newfoundland-headquartered FortisInc. on Feb. 9 announcedan $11.3 billion dealto acquire ITC Holdings Corp.That same day, southwestern Missouri utility Empire District Electric Co. to be by Canadian utilityAlgonquin Power & UtilitiesCorp.

Inaddition, the Louisiana Public Service Commission recently the of by a group of investorsthat includes British ColumbiaInvestment Management Corp. meanwhile, NovaScotia-headquartered Emera Inc.,is acquiringTECO Energy Inc.,with electric and gas utility operations in Florida and New Mexico.

Westar,the largest utility in Kansas, is larger than Empire District and Cleco,serving about 700,000 customers. The company owns approximately 7,000 MW ofgenerating capacity. Unlike Empire District and Cleco, Westar's generatingcapacity includes nuclear — a 47% ownership in the 1,205-MW plant.Ameren owns a nuclear plant as well, the 1,236-MW Callaway plant.