Uil Co. Ltd. · KRX:049520
Uil — Merger or Acquisition (May 2010)
22 slides from Uil's merger presentation, May 25, 2010
Slide 1: UIL Acquisition of SCG, CNG & The Berkshire Gas Company
Investor Presentation May 25, 2010 Strategic l Transformative l Accretive UIL Acquisition of SCG, CNG & The Berkshire Gas Company The Southern Connecticut Gas Company Connecticut Natural Gas Corporation The Berkshire Gas Company
Slide 2: Safe Harbor Provision
Safe Harbor Provision Certain statements contained herein, regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). These include statements regarding management's intentions, plans, beliefs, expectations or
Slide 3: Presenters
Presenters James P. Torgerson President and Chief Executive Officer, UIL Holdings Corporation Richard J. Nicholas Executive Vice President and Chief Financial Officer, UIL Holdings Corporation
Slide 4: Agenda
Agenda Transaction Overview UIL Overview Target Overview Southern Connecticut Gas Connecticut Natural Gas Berkshire Gas Company Regulatory Overview Combined Business Snapshot Financial Impact Steps to Close Investment Highlights Appendix
Slide 5: Transaction Overview
UIL HOLDINGS CORPORATION Transaction Overview
Slide 6: Transaction Summary
Transaction Summary Description Acquisition of three regulated gas LDCs owned by Iberdrola with approximately 369,000 customers Southern Connecticut Gas ("SCG") - 176,000 customers Connecticut Natural Gas ("CNG") - 157,000 customers Berkshire Gas Company ("BGC") - 36,000 customers Adjusted EBITDA fo
Slide 7: Pro Forma UIL Corporate Structure
Baa2 / BBB+ (Issuer / Corporate Rating) Pro Forma UIL Corporate Structure* GenConn Energy LLC 50% Companies to be Acquired Southern Connecticut Gas Connecticut Natural Gas Berkshire Gas Company The United Illuminating Company (UI) A3 / A FMB Baa2 / A- Unsecured Baa1 / A- Unsecured Joint venture betw
Slide 8: Strategic Rationale
Strategic Rationale Transformative transaction nearly doubling the size of UIL's regulated investments Expected enhanced cash flow and earnings per share accretion provide continued support of UIL's dividend Cash flow accretive immediately EPS accretive beginning in the first full year following clo
Slide 9: Strategic Rationale, cont.
Strategic Rationale, cont. Asset diversification and growth opportunities Diversifies UIL's revenue mix Diverse peaking seasons help levelize earnings and cash flow Adds gas winter peak to electric summer peak Growth opportunities through efficient expansion of customer gas utilization Cost savings
Slide 10: UIL Overview
UIL Overview As of 12/31/09 Average Rate Base (UI) of $1,055 million 325,000 electric customers Service Territory: 17 cities & towns Population ~ 736,000 1,066 employees Historic Peak Load = 1,456 MW Approximately 18% of Connecticut's Load Approximately 5% of New England's Load Composite achieved RO
Slide 11: Southern Connecticut Gas Overview
As of 12/31/09 Average Rate Base of $438 million 176,000 gas customers Service Territory: 22 cities & towns 324 employees 133,000 miles of pipeline Gas storage Access to ~ 10.5 Bcf of underground storage LNG Long-term lease providing 1.2 Bcf of capacity 2009 rate case allowed ROE of 9.26%* 1% increa
Slide 12: Connecticut Natural Gas Overview
Connecticut Natural Gas Overview As of 12/31/09 Average Rate Base of $351 million 157,000 gas customers Service Territory: 21 cities & towns 341 employees 125,000 miles of pipeline Gas Storage Access to ~ 10.6 Bcf of underground storage Owns 1 LNG facility providing 1.2 Bcf of capacity 2009 rate cas
Slide 13: Berkshire Gas Overview
Berkshire Gas Overview As of 12/31/09 Average Rate Base of $64 million 36,000 gas customers Service Territory: 20 cities & towns 127 employees 738 miles of mains Gas storage Access to ~ 1.1 Bcf of underground storage Owns 1 LNG facility providing 30,000 Mcf of capacity Operates under a constructive
Slide 14: Regulatory Overview
Regulatory Overview UIL Holdings Distribution currently operating under 2 year rate plan with full revenue decoupling pilot expiring on 2/3/11 Transmission trued up on an annual basis to allowed composite ROE based on FERC approved formula rate Southern Connecticut Gas 2009 Rate Case decision is und
Slide 15: Combined Business Snapshot
Combined Business Snapshot Combined Service Territory 2009 UIL Holdings Contribution Gas Companies Contribution Adjusted EBITDA(1) $349 Million 63% 37% Adjusted Net Income(1) $93 Million 59% 41% Avg Rate Base $1,909 Million 55% 45% Electric Customers 325,000 100% 0% Gas Customers 369,000 0% 100% Reg
Slide 16: Financial Impact
Financial Impact $1,296 million purchase price less net debt of $411 million for an expected cash payment at closing of approximately $885 million, subject to post closing adjustments UIL expects to realize transaction related tax benefits of approximately $135 million on a net present value basis E
Slide 17: Steps to Close
Steps to Close No shareowner vote required Required regulatory approvals Connecticut Department of Public Utility Control (DPUC) Massachusetts Department of Public Utilities (DPU) HSR (Hart-Scott-Rodino) Execute Financing Plan Transaction expected to close in the first quarter of 2011
Slide 18: Investment Highlights
Investment Highlights Regulation Well understood regulatory environment in Connecticut Growth Opportunities Earnings growth opportunities in core electric and gas businesses Electric Transmission 2009 composite return on equity of 12.52% Attractive Dividend Enhanced cash flow and expected earnings p
Slide 19: Q&A
Strategic l Transformative l Accretive Q&A UIL Acquisition of SCG, CNG & Berkshire Gas Company
Slide 20: Appendix - Net Income to EBITDA Reconciliation
Appendix - Net Income to EBITDA Reconciliation Amounts may not add due to rounding. Source: SEC filings and audited financial statements. (1) Last twelve months ended 03/31/2010. Quarterly data is unaudited.
Slide 21: Appendix - Net Income to Adjusted EBITDA Reconciliation
Appendix - Net Income to Adjusted EBITDA Reconciliation Amounts may not add due to rounding. Source: Adjustments based on notes in audited financial statements and estimates from discussions with Iberdrola USA management. (1) Last twelve months ended 03/31/2010. Quarterly data is unaudited.
Slide 22: Appendix - Adjusted Net Income Reconciliation
Appendix - Adjusted Net Income Reconciliation Amounts may not add due to rounding. Source: Adjustments based on notes in audited financial statements and estimates from discussions with Iberdrola USA management. (1) Last twelve months ended 03/31/2010. Quarterly data is unaudited.