Black Hills Corporation · NYSE:BKH
Black Hills — Merger or Acquisition (November 2005)
19 slides from Black Hills's merger presentation, Nov 28, 2005
Slide 1: Proposed Merger of Black Hills Corporation and NorthWestern Corporation
Slide 2: Caution regarding forward looking statements
| Caution regarding forward looking statements ‘This document includes “forward-looking, statements” as defined by the Securities and Exchange Commission, or SEC. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Secutities Litigation Refo
Slide 3: Caution regarding forward looking statements (continued)
New factors that could cause actual results to differ materially from those described in forward-looking, statements ‘emerge from time to time, and it is not possible for us to predict all such factors, or the extent to which any such factor ‘or combination of factors may cause actual results to dif
Slide 4: Overview
Overview
Slide 5: Introduction
a Introduction &™ Black Hills Corporation’s (“Black Hills”) business strategy is designed to capitalize on its core strengths: Planning, construction and operation of power generation assets Management and operation of fuel assets Strong utility operations with a commitment to customer service / foc
Slide 6: Proposal to combine with NorthWestern
a Proposal to combine with NorthWestern © Black Hills has extensively reviewed this opportunity over the last 18 months and believes itis in the best interest of both sets of shareholders and customers The transaction creates a strong, well-balanced integrated energy player in the Northern Rockies a
Slide 7: Key business statistics
a Key business statistics Statistic Black Hills NorthWestern Market Capitalization $1,271 million $1,038 million Enterprise Value $1,944 million $1,755 million Dividend $1.28/share S1.24/share Sr. Unsecured Credit Ratings Bus / BBB- Ba2/B+ (Moody’s/ S&P) Electric Customers 100,000 368,000 Gas Custom
Slide 8: Combined regional presence
a Combined regional presence Black Hills / NorthWestern combi id electric and gas service territories and selected non-regulated assets sso MW Se ceuw (WE BKH Service Tesitory NWEC Seve Tertoy KH Regulated Power le y © BEC Reged Powe Piss © BeiNcoRegasdrowerPiets — @ WWE Non Reguted Power Pians A. F
Slide 9: Summary of Proposal
| 1a) Summary of Propos
Slide 10: Black Hills' proposal
a Black Hills’ proposal ® Black Hills has initially assumed a 100% stock-for-stock transaction — May consider paying part of the consideration in cash © On November 21, Black Hills proposed an exchange of Black Hills common shares for ‘NorthWestern common shares At current stock price levels, provid
Slide 11: Black Hills in brief
1) Black Hills in brief Retail Services = Black Hills Power (electric utility) = Cheyenne Light, Fuel & Power (electric and gas utility) Focus: retail customer service, community partnerships and regulatory relationships Wholesale Energy a = Black Hills Generation (IPP) = Black Hills E&P (oil and ga
Slide 12: NorthWestern in brief
a NorthWestern in brief Regulated Utilities = 368,000 electric and 249,000 gas customers = Integrated electric utility operations in South Dakota with 312 MW regulated generation © Electric transmission and distribution operations in Montana with 236 MW non-regulated generation Focus: Primarily an e
Slide 13: Strategic Rationale
Slide 14: Strategic rationale of proposal
a Strategic rationale of proposal Benefits for Black Hills Strong utility addition ‘Improved business position with rating agencies Increases business predictability Provides Black Hills with access to additional cash flow Ability to prudently deploy capital into regulated and non-regulated investme
Slide 15: Strategic rationale - resource planning advantages
a Strategic rationale - resource planning advantages ™ Black Hills’ development expertise supports construction and operation of new regulated and/or non-regulated generation sources Improves negotiating position with wholesale suppliers in Montana 1 Black Hills has demonstrated recent success in ac
Slide 16: Strategic rationale - focus on community
a Strategic rationale — focus on community © Black Hills has a long history of successfully partnering with the communities it serves Black Hills and/or its legacy companies have been serving power to the region since 1883 Customer service satisfaction has historically been high Active partnership w
Slide 17: Next Steps
Slide 18: Required approvals for transaction
a Required approvals for transaction Assuming an agreement can be negotiated, subject to due diligence, the following approvals and consents would be required to consummate a combination Shareholder approval ~ Black Hills — NorthWestern ™ State Regulatory Commissions — Montana — South Dakota ~ Nebra
Slide 19: Searchable text section of graphics
Searchable text section of graphics shown above EN ERGY FOR THE WEST [LOGO] [GRAPHIC] INVESTOR INFORMATION Proposed Merger of Black Hills Corporation and NorthWestern Corporation November 2005 Ca ution regarding forward looking statements This document includes “forward-looking statements” as define