The Firm is representing PPL Corporation in its $7.625 billion acquisition of E.ON U.S. LLC. The acquisition includes payments to the seller of approximately $6.7 billion and the assumption of $925 million of tax-exempt debt. PPL intends to permanently finance the transaction through a combination of the proceeds of equity and debt issuances to occur prior to closing and cash on hand. In addition, the firm assisted PPL in connection with arranging a committed bridge facility in the amount of $6.5 billion from Bank of America Merrill Lynch and Credit Suisse to be used as a backstop facility in the event that the permanent financing is not available.
The acquisition will transform PPL into a more geographically diverse utility holding company with combined annual revenues of about $10 billion, serving nearly 5 million electricity customers in the United States and the United Kingdom, and owning or controlling about 20,000 megawatts of U.S. electricity generating capacity.
The transaction is expected to close by the end of this year. It requires approvals by state regulators in Kentucky, Virginia and Tennessee and by the Federal Energy Regulatory Commission as well as the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act. No shareowner approvals are necessary for the transaction.
PPL Corporation, headquartered in Allentown, Pa., owns or controls nearly 12,000 megawatts of generating capacity in the United States, sells energy in key U.S. markets and delivers electricity to about 4 million customers in Pennsylvania and the United Kingdom. E.ON U.S. LLC is the parent company of Kentucky's two major utilities, Louisville Gas & Electric Company and Kentucky Utilities Company. These high-performing utilities serve 1.2 million customers, principally in Kentucky.
The Simpson Thacher team includes: Vince Pagano, Mario Ponce, Jim Thompson and Ignacio De La Huerta (M&A), James Cross and Andrew Nightingale (Banking & Credit), Arjun Koshal (Capital Markets), Greg Grogan and Jennifer Pepin (Executive Compensation and Employee Benefits) and Sean Austin (Tax).