Great Plains Energy Inc. and Westar Energy Inc. can combine their operations under a new holding company with a combined equity value of nearly $15 billion after regulators in Kansas and Missouri approved their proposed merger May 24.
Calling the deal a "merger of equals," the Missouri Public Service Commission in an order that takes effect June 3 said the "undisputed evidence in this case shows that the merger will benefit shareholders, ratepayers, and the general public." The transaction is structured as a tax-free stock exchange with no debt used to finance the merger and acquisition premium paid by either company. The Kansas Corporation Commission in 2017 shot down a previous merger bid between the two companies because of cost concerns.
The Federal Energy Regulatory Commission signed off on the deal in March.
The combined Midwest utilities, with roughly 1.6 million electricity customers, will result in net savings of approximately $555 million over the first five years, as well as generate roughly $331 million in direct local economic benefits and $176 million in additional gross regional product through 2030, the Missouri regulator said.
A combined integrated resource plan conducted as part of the merger process found that five coal- and natural gas-fired power plants that Kansas-based Westar had planned to retire between 2023 and 2028 can retire in 2018, saving $55.4 million over the first five years after the merger closes, Missouri regulators noted. After the merger, the combined renewables portfolios of the companies will account for around 30% of their retail sales.
As part of the conditions of the merger, the new holding company, to be named Evergy Inc., will be jointly headquartered in Topeka, Kan., and Kansas City, Mo. Evergy will trade under the stock symbol EVRG.
