E.ON SE · XETR:EOAN
E.ON — Merger or Acquisition (April 2001)
17 slides from E.ON's merger presentation, Apr 9, 2001
Slide 1: From European to Global Powerhouse
From European to Global Powerhouse Recommended Pre-Conditional Offer for Powergen Analyst and Investor Conference London, 9 April 2001
Slide 2: E.ON: From European to Global powerhouse
E.ON: From European to Global powerhouse • Creates world’s largest investor-owned electricity and gas utility – leading scale positions in all top three European markets (Western Europe(1) , Scandinavia, UK) – substantial growth opportunities in the US • Ability to deliver on best-in-class aspiratio
Slide 3: Focus and growth: The next stage for E.ON
Focus and growth: The next stage for E.ON Becoming a pure-play utility • Commitment to divest non-utility businesses • Timeframe for additional disposals latest within 3-5 years after closing • Proceeds will be redeployed in the utility business Growing through the acquisition of Powergen • Pan-Euro
Slide 4: The UK: A key European market
The UK: A key European market • Third largest European electricity market (~ 300 TWh sales) • Leading country in energy liberalisation • Value creating opportunities exist for – flexible portfolio generators – experienced asset backed traders – efficient operators of distribution assets – innovative
Slide 5: The US: World's largest power market
The US: World’s largest power market • Larger than total European electricity market • Offers higher growth and return potential than Europe • Integrated utility as the accepted business model • Value creation opportunitities from introducing European best practices • Further opportunities arising f
Slide 6: Powergen: UK excellence
Powergen: UK excellence • World-class, flexible and diversified generation portfolio Assets • Efficient distribution assets • Integrated trading strategy Trading • Leading market player • Targeted marketing strategy with strong brand Retail • More than 3 million customer accounts - and growing 5
Slide 7: Midwest an attractive region within the US power market
Midwest an attractive region within the US power market North American Electricity Pools(1) • Midwest(2) with around 30% of US electricity demand • Crossroads of major energy flows, well interconnected MAIN and with good fuel supply options Detroit Chicago New York • Heavily industrialised region MA
Slide 8: E.ON: An excellent platform for growth in the US through LG&E
E.ON: An excellent platform for growth in the US through LG&E • Attractive regional location – crossroad of major energy flows – consolidation opportunities in fragmented market – positive regulatory environment • European liberalisation experience: a core transferable competence • Financial and ope
Slide 9: Corporate Governance
Corporate Governance E.ON AG Düsseldorf Powergen plc E.ON Energie AG London Munich Chairman: U. Hartmann Deputy Chairman: E. Wallis CEO: N. Baldwin 8
Slide 10: Transaction timing
Transaction timing Process Milestones Expected Timing • Pre-conditional offer • April 2001 • Pre-conditions met • early 2002 – E.ON registered under PUHCA – Regulatory clearances (OFGEM, SEC, FERC, PSC of Kentucky and Virginia) – Anti-Trust clearance (EU, HSR) • Launch of offer • early 2002 • Closin
Slide 11: Transaction terms
Transaction terms • Recommended preconditional offer • 765 p per Powergen share – cash offer – loan note alternative (1) • Powergen shareholders dividend rights – four quarterly interim dividends of 9.2p per share for 2001 – day-to-day accrual at a rate of 9.2p per share per quarter thereafter (1) S
Slide 12: An attractive deal for E.ON and its shareholders
An attractive deal for E.ON and its shareholders • Creating financial value even without immediate operational synergies – in line with E.ON’s strict investment criteria – very attractive price in comparison to other European utility transactions – immediate and substantial enhancement of earnings p
Slide 13: Ed Wallis, Chairman, Powergen
Ed Wallis Chairman, Powergen 12
Slide 14: Nick Baldwin, Chief Executive, Powergen
Nick Baldwin Chief Executive, Powergen 13
Slide 15: Powergen's business model
Powergen‘s business model Energy Trading “the integrated hub” Behaviours Values Assets “world class Retail asset managers” “competing and winning” 14
Slide 16: LG&E: US excellence
LG&E: US excellence • Reliable, low cost generation assets Generation • Opportunities for off-system sales at attractive rates • Top quartile regional efficiency ranking in distribution Distribution - and improving • High service levels and customer satisfaction (#1 JD Power survey (1)) • Favourable
Slide 17: E.ON: A leading global powerhouse
E.ON: A leading global powerhouse • Focused utility business • Global leadership position in power • Poised for future growth in US and Europe • Best-in-class skills across value chain • High quality international management team 16