IES Holders Urged to Back Dissident's Merger Plan
May 11, 2011
CEDAR RAPIDS, Iowa -- Institutional Shareholder Services, an influential proxy advisory firm, recommended that stockholders at IES Industries Inc. vote against the company's planned merger with two other utilities. It suggested holders vote for dissident proxy materials filed by IES's unwanted suitor, MidAmerican Energy Co.. The competing merger proposals offer IES holders a ``win-win situation,'' the advisory concern said. Both will provide a significant premium to the earlier price of IES's shares, and both will combine the smaller utility with a larger and more financially stable company. It noted as well that, because of the different interpretations possible of some strategic and regulatory issues, analyst opinion is divided over which plan is superior. Citing the larger premium MidAmerican's bid would provide, the advisory concern said ``we believe discussions with MidAmerican Energy regarding its offers are warranted.'' IES agreed last year to merge with Interstate Power Co. and WPL Holdings Inc., to form a regional utility company. Earlier this month MidAmerican, of Des Moines, sought to derail that combination by proposing a $1.15 billion cash-and-stock buyout offering $39 a share for as much as 40% of IES's shares, and stock valued at $38.12 for the other shares. When IES rejected that bid for a sweetened version of its preferred three-way combination, MidAmerican filed competing proxy materials. Because MidAmerican doesn't have a formal offer in front of IES holders, a vote for its proxy at the May 18, 2011 is a vote against the three-way merger. The combination IES prefers offers IES holders stock valued at $35.20.
