Ppl Corporation · NYSE:PPL
Ppl — Merger or Acquisition (April 2010)
27 slides from Ppl's merger presentation, Apr 29, 2010
Slide 1: Value | Balance | Growth: Acquisition of E.ON U.S.
Value | Balance | Growth Acquisition of E.ON U.S. April 29, 2010 © PPL Corporation 2010 Exhibit 99.2
Slide 2: Cautionary Statements and Factors That May Affect Future Results
© PPL Corporation 2010 1 Cautionary Statements and Factors That May Affect Future Results Any statements made in this presentation about future operating results or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of
Slide 3: Agenda
© PPL Corporation 2010 2 Agenda Introduction Jim Miller Chairman, President and CEO, PPL E.ON U.S. Overview Vic Staffieri CEO, E.ON U.S. Transaction Overview and Timing Bill Spence EVP and COO, PPL Concluding Remarks Jim Miller Chairman, President and CEO, PPL Q&A
Slide 4: Combination Creates Significant Value
© PPL Corporation 2010 3 Combination Creates Significant Value § Transformative transaction that rebalances business mix § Consistent with our stated strategy to grow regulated earnings § Creates a stronger, more diversified enterprise with increased earnings visibility § Strengthens solid investmen
Slide 5: A Compelling Opportunity
© PPL Corporation 2010 4 A Compelling Opportunity § Best-in-class utility franchises with progressive regulation § Very strong management team; strong track record of execution § Significant rate base growth profile with high degree of near-term visibility § Lowest rates in the region § Track record
Slide 6: EBITDA Significantly and Immediately Rebalances Business Mix
© PPL Corporation 2010 5 EBITDA Significantly and Immediately Rebalances Business Mix (1) Based on mid-point of 2010 forecast.
Slide 7: Increased Scale with Continued Growth
© PPL Corporation 2010 6 Increased Scale with Continued Growth Note: Represents capitalization for E.ON US since LG&E and KU rate constructs are based on capitalization. (1) Figures based on assumed exchange rate of $1.60 / GBP. ($ in billions) 2011E - 2014E CAGR: 7.1%
Slide 8: Pro Forma Structure: Strengthened Utility Platform
© PPL Corporation 2010 7 Pro Forma Structure PPL Corporation WPD PPL Electric Utilities PPL Energy Supply E.ON U.S. Strengthened Utility Platform ($ in billions) (1) Based on PPL stock price as of 4/27/2010. (2) Represents utility capitalization for E.ON US since LG&E and KU rate constructs are base
Slide 9: Best-in-Class Utility Operations
© PPL Corporation 2010 8 An unparalleled commitment to customer service, reliability and safety Best-in-Class Utility Operations § J.D. Power study of business customer satisfaction among Eastern U.S. utilities – Ranked 1 st 8 times in the past 11 years – Total of 16 awards, more than any other elec
Slide 10: LG&E and KU Will Be Important Parts of PPL
© PPL Corporation 2010 9 LG&E and KU Will Be Important Parts of PPL § Complementary cultures § Strong addition to the management team § Customer commitments § Regulatory relationships § Headquarters and management of E.ON U.S., LG&E and KU remain in Kentucky
Slide 11: E.ON U.S. Overview
© PPL Corporation 2010 10 © PPL Corporation 2010 E.ON U.S. Overview
Slide 12: E.ON U.S. Overview
© PPL Corporation 2010 11 E.ON U.S. Overview Louisville Gas & Electric Kentucky Utilities E.ON U.S. § Vertically integrated utilities serving 2/3 of counties in Kentucky § Small customer base in Virginia and Tennessee § Fuel, purchased power, gas supply and environmental cost pass- through § No mate
Slide 13: Top Quartile Cost Performance
© PPL Corporation 2010 12 Only utility with top quartile cost performance in five major cost areas over the 2004-2008 period Top Quartile Cost Performance (1) E.ON US cost adjusted upward to include CWIP changes over the five-year period. (2) E.ON US cost adjusted upward to include $80 million of Va
Slide 14: Competitive Rates: 2009 electric retail rate comparison
© PPL Corporation 2010 13 Competitive Rates 2009 electric retail rate comparison (¢/kilowatt hour) Source: Edison Electric Institute, typical bills and average rates report, winter 2010 (covers January 2009 through December 2009). Note: The EEI report surveys approximately 90 electric utilities in t
Slide 15: Pending Rate Cases
© PPL Corporation 2010 14 Pending Rate Cases § On January 29, 2010, LG&E and KU filed applications with the KPSC requesting annual increases in base electric and gas rates – Total request of $253 million – Includes 11.5% requested ROE, 53% Equity – Majority of request associated with investment and
Slide 16: Progressive and Constructive Regulation
© PPL Corporation 2010 15 Supportive and progressive regulation combined with competitive customer rates Progressive and Constructive Regulation Environmental Cost Recovery (“ECR”) § Recovery of and return on environmental investment required as a result of coal combustion reflected in bill two mont
Slide 17: Strong Regulated Growth Profile
© PPL Corporation 2010 16 Strong Regulated Growth Profile Capital expenditures Significant rate base growth opportunity driven by balanced capital expenditures with realized ROEs ranging from 10-12% historically Capitalization (1) ($ in millions)
Slide 18: Transaction Overview and Timing
© PPL Corporation 2010 17 © PPL Corporation 2010 Transaction Overview and Timing
Slide 19: Transaction Overview
© PPL Corporation 2010 18 Estimated Closing Financing Pro Forma Profile Regulatory Approvals Consideration Transaction Overview § Committed bridge financing for cash portion of purchase price § Permanent financing to include debt, equity and high-equity-content securities, and cash on hand § PPL exp
Slide 20: Transaction Financing
© PPL Corporation 2010 19 Committed Acquisition Facility Permanent Financing Transaction Financing § $6.5 billion committed bridge facility from Bank of America Merrill Lynch and Credit Suisse § Financing term extends beyond the expected timing of regulatory approvals Balanced combination of financi
Slide 21: Transaction Timeline
© PPL Corporation 2010 20 Transaction Announced Filed with KPSC KPSC Approval KPSC has historically approved similar transactions in relatively short timeframes Transaction Timeline E.ON / PowerGen April 2001 May 2001 September 2001 PowerGen / LG&E February 2000 March 2000 May 2000 LG&E / KU May 199
Slide 22: Concluding Remarks
© PPL Corporation 2010 21 © PPL Corporation 2010 Concluding Remarks
Slide 23: Concluding Remarks
© PPL Corporation 2010 22 Concluding Remarks § Adds a best-in-class utility franchise § Attractive valuation § Rebalances business mix § Improves financial flexibility § Strengthens credit profile § Better positions for future growth § Expected year-end 2010 closing
Slide 24: Combined Utility Platform
© PPL Corporation 2010 23 Combined Utility Platform PPL Service territory Generating assets E.ON U.S. Service territory Generating assets Note: Represents only PPL Electric Utilities service territory and generation in PA.
Slide 25: Q&A
© PPL Corporation 2010 24 Q&A
Slide 26: Forward-Looking Information Statement
© PPL Corporation 2010 25 Forward-Looking Information Statement Statements contained in this presentation, including statements with respect to future events and their timing, including the acquisition by PPL Corporation of E.ON U.S., LLC and its subsidiaries Louisville Gas & Electric Company and Ke
Slide 27: 2010
© PPL Corporation 2010 © PPL Corporation 2010