Reaches Agreement with Bluescape Energy
Partners and Elliott Investment Management
Reaffirms Commitment to Sustainability
Transformation Plan (STP) and Expected 6% to 8% EPS CAGR Through
2024
C. John Wilder to Chair Finance Committee of
the Board
Evergy, Inc. (NYSE: EVRG) today announced that it has entered
into agreements with Bluescape Energy Partners LLC (“Bluescape”)
and Elliott Investment Management L.P. (“Elliott”) and certain of
their respective affiliates. As part of the Bluescape agreement, C.
John Wilder, Executive Chairman of Bluescape, and former U.S.
Senator Mary L. Landrieu, will join the Evergy Board of Directors,
effective March 1. These appointments bring two highly qualified
directors with deep industry experience and a wealth of public
policy knowledge to the Evergy Board.
Additionally, the composition of the five-member Finance
Committee will be amended such that its members are David Campbell,
Paul Keglevic, Tony Isaac, Landrieu and Wilder, who will serve as
chair. As Evergy aspires to achieve top quartile performance across
its business, the charter of the Finance Committee has been amended
to include competitive analysis and benchmarking of the Company’s
key operating, customer, financial and sustainability performance
metrics.
“Evergy has made significant advancements as a forward-thinking,
sustainable energy company,” said Mark Ruelle, Evergy Board Chair.
“Our Sustainability Transformation Plan positions Evergy to drive
even higher performance across our organization, and this agreement
brings additional expertise to support its execution. Both John and
Mary have proven track records creating significant value for all
stakeholders, and we welcome them to the Board.”
In connection with the agreement, Bluescape will be making an
equity investment of approximately $115 million in the Company by
purchasing newly issued Evergy common shares. Bluescape will have
the option to purchase additional Evergy common shares over the
next three years at a per share price that is 20% higher than the
current per share market price.
Ruelle continued, “The STP will enable us to deliver
best-in-class earnings growth, optimize capital allocation and
significantly increase operational efficiencies. Bluescape’s
investment represents a strong vote of confidence in Evergy, our
team and the value we can achieve through this plan.”
High Performance and the Sustainability Transformation
Plan
Evergy reaffirmed the Company’s long-term earnings growth rate
target of 6% to 8% per year from 2019 through 2024, consistent with
top-performing utilities. Additionally, the Company looks forward
to working with Wilder and Landrieu to implement the STP and to
optimize the plan to generate industry-leading performance across
the Company’s operating performance, financial performance and
customer service functions. Evergy’s Board and leadership team are
committed to executing the STP by:
- Continuing to improve regional rate competitiveness;
- Further advancing efficiency and operational performance,
driving high performance in cost, operating metrics and
safety;
- Optimizing infrastructure investments, including updates to
transmission and distribution infrastructure and customer-facing
platforms, driving high performance in reliability and customer
service;
- Developing and implementing a program to enable the sustainable
transformation of the Company’s generation fleet, including
investments in new renewable resources, while advancing the
Company’s goals of reliability, sustainability and affordability;
and
- Continuing to focus on regulatory and stakeholder relationships
to promote long-term policies that enhance reliability,
sustainability and affordability in Kansas and Missouri.
Evergy plans to hold an Investor Day in the third quarter of
2021 to update shareholders on the STP and the continued progress
on its implementation.
“Continuous improvement is core to Evergy’s mission,” said David
Campbell, Evergy President and Chief Executive Officer. “Through
improved efficiency and operating performance, increased
infrastructure investments, and the transition of our generation
fleet, we will provide our customers with sustainable, reliable and
affordable energy while driving superior shareholder value.”
“I am excited to join Evergy’s Board of Directors and make the
most of this truly unique opportunity,” said Wilder. “I look
forward to working with the Board, David, Kirk Andrews, Kevin
Bryant, and the broader management team to refine and implement the
STP for the benefit of all Evergy stakeholders. I believe Evergy
can significantly improve its competitiveness with relentless
execution of the STP, which will have the long-term benefit of
making Evergy a more resilient and customer-centered company to
thrive in the dramatically changing electric power industry.”
“We appreciate the constructive dialogue with Evergy’s Board,
and more recently with David,” said Jeff Rosenbaum, Senior
Portfolio Manager at Elliott. “We are pleased with Bluescape’s
investment in Evergy. We believe that the appointment of Mary
Landrieu to the Board and John Wilder’s new role as chair of the
revamped Finance Committee will help the Company provide
significant value for all stakeholders. We are confident that
Evergy has the right plan and the right team in place.”
Pursuant to their agreements with the Company, Elliott and
Bluescape have agreed to customary standstill, voting, and other
provisions. The full agreement between Evergy and Bluescape, as
well as Bluescape’s investment and the related agreements, will be
filed on a Form 8-K with the SEC.
Advisors
Morgan Stanley & Co. LLC acted as lead financial advisor to
Evergy and Goldman Sachs & Co LLC also acted as financial
advisor. Cravath, Swaine & Moore LLP is acting as legal advisor
to Evergy.
About C. John Wilder
C. John Wilder is the Executive Chairman of Bluescape. Wilder
serves on the boards of directors of several private portfolio
companies. Wilder has previously served on the board of many
private and public companies, including NRG and TXU Corp. He served
in executive officer roles in TXU Corp., Entergy Corp., and Royal
Dutch/Shell Group.
About Mary L. Landrieu
Senator Mary Landrieu served in the United States Senate for
three terms, first elected in 1996. During her tenure, she was a
member (and then Chair) of the Senate Energy and Natural Resources
Committee, as well as a member of the Senate Armed Services
Committee, the Appropriations Committee, and Chair of the Small
Business and Entrepreneurship Committee. In her role as Chair of
the Small Business Committee, she was the lead sponsor of the Small
Business Jobs Act of 2010, which helped to create and retain over
650,000 American jobs. Prior to serving in the U.S. Senate, she
served in the Louisiana State Legislature from 1979 - 1987. In
1987, she was elected State Treasurer and served with distinction
for two terms. Senator Landrieu currently serves as Senior Policy
Advisor at Van Ness Feldman LLP, a law and government relations
firm, specializing in energy, environment and natural resources
law. Senator Landrieu also serves on the Board of Directors of
Tyler Technologies, Inc. (NYSE: TYL), where she serves on the
nominating and governance committee.
About Evergy, Inc.
Evergy, Inc. (NYSE: EVRG) serves approximately 1.6 million
customers in Kansas and Missouri. We were formed in 2018 when
long-term local energy providers KCP&L and Westar Energy
merged. We are a leader in renewable energy, supplying nearly half
of the power we provide to homes and businesses from emission-free
generation. We support our local communities where we live and work
and strive to meet the needs of customers through energy savings
and innovative solutions.
About Elliott
Elliott Investment Management L.P. manages approximately $41.8
billion of assets. Its flagship fund, Elliott Associates, L.P., was
founded in 1977, making it one of the oldest funds under continuous
management. The Elliott funds' investors include pension plans,
sovereign wealth funds, endowments, foundations, funds-of-funds,
high net worth individuals and families, and employees of the
firm.
About Bluescape
Bluescape, founded in 2007, is an alternative investment firm
that leverages its private capital, global network, and superior
thinking to deliver differentiated long term investment performance
in the broader energy and utility sectors. Bluescape employs a
unique approach and long-term perspective, helping position
companies for growth and value creation by providing capital and
strategic oversight with its multi-disciplined team of
executive-level managers, operators, strategic consultants, and
restructuring advisors. It thrives to uncover investments
exhibiting high performance potential where it seeks to build
lasting partnerships. Bluescape thrives to create positive impacts
for all of its stakeholders through its capital, operational
capabilities, and long-term ownership model.
Forward Looking Statements
Statements made in this release that are not based on historical
facts are forward-looking, may involve risks and uncertainties, and
are intended to be as of the date when made. Forward-looking
statements include, but are not limited to, statements relating to
our strategic plan, including, without limitation, those related to
earnings per share, dividend, operating and maintenance expense and
capital investment goals; the outcome of legislative efforts and
regulatory and legal proceedings; future energy demand; future
power prices; plans with respect to existing and potential future
generation resources; the availability and cost of generation
resources and energy storage; target emissions reductions; and
other matters relating to expected financial performance or
affecting future operations. Forward-looking statements are often
accompanied by forward-looking words such as “anticipates,”
“believes,” “expects,” “estimates,” “forecasts,” “should,” “could,”
“may,” “seeks,” “intends,” “proposed,” “projects,” “planned,”
“target,” “outlook,” “remain confident,” “goal,” “will” or other
words of similar meaning. Forward-looking statements involve risks,
uncertainties and other factors that could cause actual results to
differ materially from the forward-looking information.
In connection with the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, Evergy, Inc., Evergy
Kansas Central, Inc. and Evergy Metro, Inc. (collectively, the
Evergy Companies) are providing a number of risks, uncertainties
and other factors that could cause actual results to differ from
the forward-looking information. These risks, uncertainties and
other factors include, but are not limited to: economic and weather
conditions and any impact on sales, prices and costs; changes in
business strategy or operations; the impact of federal, state and
local political, legislative, judicial and regulatory actions or
developments, including deregulation, re-regulation, securitization
and restructuring of the electric utility industry; decisions of
regulators regarding, among other things, customer rates and the
prudency of operational decisions such as capital expenditures and
asset retirements; changes in applicable laws, regulations, rules,
principles or practices, or the interpretations thereof, governing
tax, accounting and environmental matters, including air and water
quality and waste management and disposal; the impact of climate
change, including increased frequency and severity of significant
weather events and the extent to which counterparties are willing
to do business with, finance the operations of or purchase energy
from the Evergy Companies due to the fact that the Evergy Companies
operate coal-fired generation; prices and availability of
electricity in wholesale markets; market perception of the energy
industry and the Evergy Companies; the impact of the Coronavirus
(COVID-19) pandemic on, among other things, sales, results of
operations, financial condition, liquidity and cash flows, and also
on operational issues, such as the availability and ability of our
employees and suppliers to perform the functions that are necessary
to operate the Evergy Companies; changes in the energy trading
markets in which the Evergy Companies participate, including
retroactive repricing of transactions by regional transmission
organizations (RTO) and independent system operators; financial
market conditions and performance, including changes in interest
rates and credit spreads and in availability and cost of capital
and the effects on derivatives and hedges, nuclear decommissioning
trust and pension plan assets and costs; impairments of long-lived
assets or goodwill; credit ratings; inflation rates; the transition
to a replacement for the London Interbank Offered Rate (LIBOR)
benchmark interest rate; effectiveness of risk management policies
and procedures and the ability of counterparties to satisfy their
contractual commitments; impact of physical and cybersecurity
breaches, criminal activity, terrorist attacks and other
disruptions to the Evergy Companies’ facilities or information
technology infrastructure or the facilities and infrastructure of
third-party service providers on which the Evergy Companies rely;
ability to carry out marketing and sales plans; cost, availability,
quality and timely provision of equipment, supplies, labor and
fuel; ability to achieve generation goals and the occurrence and
duration of planned and unplanned generation outages; delays and
cost increases of generation, transmission, distribution or other
projects; the Evergy Companies’ ability to manage their
transmission and distribution development plans and transmission
joint ventures; the inherent risks associated with the ownership
and operation of a nuclear facility, including environmental,
health, safety, regulatory and financial risks; workforce risks,
including those related to the Evergy Companies’ ability to attract
and retain qualified personnel, maintain satisfactory relationships
with their labor unions and manage costs of, or changes in,
retirement, health care and other benefits; disruption, costs and
uncertainties caused by or related to the actions of individuals or
entities, such as activist shareholders or special interest groups,
that seek to influence our strategic plan, financial results or
operations; the possibility that strategic initiatives, including
mergers, acquisitions and divestitures, and long-term financial
plans, may not create the value that they are expected to achieve
in a timely manner or at all; difficulties in maintaining
relationships with customers, employees, regulators or suppliers;
and other risks and uncertainties.
This list of factors is not all-inclusive because it is not
possible to predict all factors. Additional risks and uncertainties
are discussed from time to time in current, quarterly and annual
reports filed by the Evergy Companies with the Securities and
Exchange Commission (SEC). Reports filed by the Evergy Companies
with the SEC should also be read for more information regarding
risk factors. Each forward-looking statement speaks only as of the
date of the particular statement. The Evergy Companies undertake no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise, except as required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20210226005147/en/
Media: Gina Penzig Manager, External Communications Phone:
785-575-8089 Gina.Penzig@evergy.com Media line: 888-613-0003
Investors: Cody VandeVelde Director, Investor Relations Phone:
785-575-8227 Cody.VandeVelde@evergy.com
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