KCPL Holders Spurned Deal With UtiliCorp, Western Says
May 01, 2011
TOPEKA, Kan. -- Western Resources Inc. said an informal, early tally indicates that Kansas City Power & Light Co. shareholders rejected a proposed $1.7 billion friendly merger with UtiliCorp United Inc., opening the way for Western Resources' own $1.9 billion unfriendly bid for Kansas City Power. Western Resources' assertion of victory, issued immediately after the close of a sharply contested shareholder vote Friday, was countered by Kansas City Power Chairman Bronson Graves, who said he was optimistic about the result of the vote and would await a formal outcome. UtiliCorp said it, too, would wait for a formal result before deciding on further action. That will take considerable time, under a schedule expected by Kansas City Power, which, like UtiliCorp, is based in Kansas City, Mo.. According to the utility, formal results of the ballot won't be available until next month. Kansas City Power, which provides electricity to much of eastern Kansas and western Missouri, urged holders not to tender shares to Western Resources' about $31-a-share bid for Kansas City Power in the meantime. Western Resources said that, based on proxy cards submitted to it, it estimates that some 51.1 million votes were cast, representing an 82.6% turnout of those shares eligible to vote. Western said it turned in proxies voting against and abstaining, which, counted together with shares from brokers and other institutions, accounted for 53% of the votes cast. Even assuming that Western has miscalculated slightly, the Kansas City Power-UtiliCorp deal still faces an uphill battle. The merger partners believe they can proceed with the approval of 50% of shareholders. But a federal judge earlier this month found that a two-thirds vote is required under Missouri law; UtiliCorp and Kansas City Power have pledged an appeal. Meanwhile, last Wednesday UtiliCorp shareholders overwhelmingly approved the merger.
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