Evergy, Inc. · NASDAQ:EVRG
Evergy — Merger or Acquisition (January 2018)
27 slides from Evergy's merger presentation, January 2018
Slide 1: Merger to Form Leading Energy Company
MERGER TO FORM LEADING ENERGY COMPANY January 2018 Investor Update
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements made in this presentation that are not based on historical facts are forward-looking, may involve risks and uncertainties, and are intended to be as of the date when made. Forward-looking statements include, but are not limited to, statements relating to the ant
Slide 3: Recent Focus
Recent Focus • Merger Approval Update Shareholder Approval – overwhelming support with more than 90 percent of shares voted in favor at each company – November 2017 Received HSR antitrust clearance – December 2017 • Ryan A. Silvey confirmed as Missouri Public Service Commissioner – January 2018
Slide 4: Merger Overview
Merger Overview f!
Slide 5: Creating A Leading Energy Company
Creating A Leading Energy Company Expect to deliver exceptional Shareholders value through attractive earnings and dividend growth Merger Drives Serving customers and Customers & communities with reliable Value For All Communities service, clean energy, and Stakeholders fewer and lower rate increase
Slide 6: Merger Of Equals
Merger Of Equals • Creates a leading energy company with a combined • Exchange Ratio equity value of ~$14.5 billion1 – a more valuable WR: 1:1 (52.5% ownership) company for shareholders and a stronger company GXP: 0.5981:1 (47.5% ownership) for customers • Transaction structure directly responsi
Slide 7: Stronger Platform For Earnings Growth
Stronger Platform For Earnings Growth Targeted Pro Forma EPS Growth1 $3.57 6%-8% $3.25 $2.43 CAGR 2016A Pro Forma 2021E Driven by the Following Assumptions: • Merger savings • FERC regulated transmission growth • Share repurchases over first two years after closing • Anticipated 2018 general rate re
Slide 8: Stronger Platform For Dividend Growth
Stronger Platform For Dividend Growth 1 Targeted Pro Forma Dividend Growth $2.32 6%-8% $2.19 CAGR $1.84 Pro Forma 2018E Pro Forma 2021E • Initial dividend results in 15% increase for Westar’s shareholders • Initial dividend maintains Great Plains Energy’s current dividend policy • Targeted annual di
Slide 9: Strong Platform For Merger Savings
Strong Platform For Merger Savings Targeted Merger Savings ($mm)1 Targeted O&M Cost Reductions ($mm)2 $149.4 $1,367 $143.5 ~$1,100 – $1,200 $110.3 ~(15%) $27.8 3 2016A 2021E 2018E 2019E 2020E 2021E Great Plains Energy Westar Pro Forma • Combination provides maximum opportunities for efficiencies, co
Slide 10: Financial Benefits
Financial Benefits • Projected significant earnings accretion to Great Plains Energy and Westar Energy • Expect to offer top quartile total shareholder return amongst electric utilities: Target EPS growth of 6% to 8%, 2016 to 20211 Target dividend growth in line with EPS growth, 60% to 70% targe
Slide 11: Strong Credit with Capacity for Share Repurchases
Strong Credit with Capacity for Share Repurchases • Great Plains Energy completed unwind of prior debt and mandatory convertible preferred equity acquisition financing following July 2017 merger of equals announcement • Merger of equals structure with no merger debt results in a strengthened credit
Slide 12: Merger Expected To Close Second Quarter of 2018
Merger Expected To Close Second Quarter of 2018 Approval Stakeholder Filed Anticipated Additional Information GXP and WR shareholders Approved November 21, 2017 KCC 2Q18 Docket: 18-KCPE-095-MER MPSC 2Q18 Docket: EM-2018-0012 FERC 1Q18 – 2Q18 Docket: EC17-171 NRC 1Q18 – 2Q18 Docket: 50-48
Slide 13: State Merger Procedural Schedules
State Merger Procedural Schedules Key Dates (2018) Kansas Corporation Commission Missouri Public Service Commission1 January 16 Rebuttal Testimony Due January 22 Public Hearing January 29 Staff/Intervenor Direct Testimony Due February 19 Rebuttal Testimony Due February 21 Surrebuttal Testimony Due W
Slide 14: Regulatory and Legislative Priorities
Regulatory and Legislative Priorities
Slide 15: Regulatory Initiatives
Regulatory Initiatives Westar General Rate Review Considerations: • Western Plains Wind Farm • Expiration of wholesale contracts currently reflected in rates as offsets to retail cost of service • Expiring production tax credits from initial wind investments • Federal income tax reform • Updated dep
Slide 16: Constructive Ratemaking
Constructive Ratemaking Westar KCP&L KCP&L GMO Cost Recovery Mechanisms Kansas Kansas Missouri Missouri Energy Cost Adj. Rider (KS) / Fuel Adj. Clause Rider (MO) √ √ √ √ Pension and OPEB Tracker √ √ √ √ Property Tax Surcharge Rider √ √ Energy Efficiency Cost Recovery Rider √ √ Missouri Energy Effici
Slide 17: State Commissioners
State Commissioners Missouri Public Service Commission (MPSC) Kansas Corporation Commission (KCC) Mr. Daniel Y. Hall (D) Mr. Pat Apple (R) Chair (since August 2015) Chair (since January 2017) Term began: September 2013 Term began: March 2014 Term expires: September 2019 Term expires: March 20181 Mr.
Slide 18: Clean Energy Leader
Clean Energy Leader f!
Slide 19: Sustainable Energy Portfolio
Sustainable Energy Portfolio • Combined wind portfolio will be one of the largest in the United • Focused on growing renewables while retiring end-of-life States: ~3,200 MW 1 fossil plants • Renewable energy ~30% of retail sales • Strong platform to grow renewables and take advantage Emission-free
Slide 20: Appendix
Appendix f!
Slide 21: Projected Merger Savings
Projected Merger Savings Merger Savings by Type and Year ($mm)1,2 2016- 2017 2018E 2019E 2020E 2021E 2022E Total NFOM - $38.3 $66.6 $78.1 $83.2 $85.3 $351.5 Labor NFOM Non- - $8.6 $41.4 $55.1 $54.3 $61.1 $220.5 Labor Fuel - $0.7 $1.0 $1.1 $1.3 $2.3 $6.4 Other - $2.2 $7.9 $12.3 $13.3 $13.4 $49.0 Gros
Slide 22: Creating a Leading Midwest Energy Utility
Creating a Leading Midwest Energy Utility SELECTED MID-CAP UTILITIES BY ENTERPRISE VALUE ($BN) $22.6 $21.1 $19.6 $17.3 $14.9 $14.5 $13.1 $12.7 $12.5 $11.4 $9.8 $9.8 $14.3 $14.3 $12.2 $8.6 $9.9 $9.5 $9.5 $8.1 $7.5 $6.9 $5.7 $6.6 Combined WR GXP Company Market Cap EV SELECTED MID-CAP UTILITIES BY CUST
Slide 23: Compelling Strategic and Geographic Fit
Compelling Strategic and Geographic Fit • Better positioned to meet customer’s energy needs, provide clean energy and optimize investments to achieve improved long-term financial returns • Increased scale and jurisdictional diversity with enhanced platform to drive value for shareholders and custome
Slide 24: Pro Forma Corporate Structure
Pro Forma Corporate Structure NewCo1 Kansas City Power & KCP&L Greater Great Plains Energy Westar Energy Light Missouri Operations Other Subsidiaries Westar Subsidiaries, notably, KG&E 1. NewCo and operating utilities will be rebranded, with study underway. January 2018 Investor Update 24
Slide 25: Pro Forma Executive Officer Team
Pro Forma Executive Officer Team President & CEO Terry Bassham SVP Marketing, Public EVP Chief Operating EVP Strategy & Chief EVP Chief Financial SVP Chief People SVP General Counsel Affairs & Chief Officer Administrative Officer Officer Officer & Corporate Secretary Customer Officer Kevin Bryant Gr
Slide 26: Key Terms
Key Terms • All stock merger of equals (100% stock-for-stock tax-free exchange); combined equity value of Transaction ~$14.51 billion Structure • New company to be jointly named prior to close • Westar Energy: 1:1 Exchange Ratio • Great Plains Energy: 0.5981:1 Approximate Pro • Westar Energy 52.5% F
Slide 27: Investor Relations Information
Investor Relations Information NYSE: WESTAR ENERGY (WR) NYSE: GREAT PLAINS ENERGY (GXP) Cody VandeVelde Lori Wright Director, Investor Relations Vice President – Corporate Planning, Investor (785) 575-8227 Relations and Treasurer cody.vandevelde@westarenergy.com (816) 556-2506 lori.wright@kcpl.com A