The Missouri Public Service Commission has unanimously approved the merger of Great Plains Energy Incorporated and Westar Energy Incorporated. The Commission determined the merger will benefit shareholders, ratepayers, and the general public.
Great Plains Energy is the holding company for Kansas City Power and Light Company and KCP&L Greater Missouri Operations Company stock. KCP&L and GMO provide electric service and are under the Missouri Public Service Commission’s jurisdiction in Missouri. KCP&L and Westar provide electric service and are under the Kansas Corporation Commission in Kansas.
The Missouri Public Service Commission reported that the Great Plains Energy and Westar merger will provide an opportunity to reduce the upward pressure on customers rates from increasing costs and flat or declining customer usage. Combining the companies will create operational efficiencies without involuntary staff layoffs, which will result in net savings from the merger of about $555,000,000 over the first five years after closing.
The merger will provide upfront customer bill credits, no recovery of transaction costs in rates, and no change in the nature of customers interactions with their service provider. The Commission reported the merger savings will serve to reduce the cost of service and delay rate increases that would be required without the merger.
The merger application says that Great Plains Energy and Westar would merge through the creation of a new holding company called Holdco and an exchange of common stock. Holdco would be renamed by the close of the merger with a new yet-to-be-determined name. The new holding company would be a publicly-traded, non-utility holding company that would be the parent company owning KCP and L, GMO, and Great Plains Energy’s other subsidiaries as well as Westar and its subsidiaries.
The parties in the case submitted two agreements to the Commission containing conditions and commitments for approval of the merger between Great Plains Energy and Westar. The Commission adopted the conditions and commitments.
KCP&L serves about 272,800 electric customers in Missouri, including the Green Hills county of Livingston. GMO provides electric service to about 320,500 customers, including the Green Hills counties of Daviess, Grundy, Harrison, Livingston, and Mercer.