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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 240.14a-11(c) or Rule
240.14a-12
KANSAS CITY POWER & LIGHT COMPANY
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transaction
applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[X] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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FOR IMMEDIATE RELEASE
Media Contacts: Investor Contact:
Pam Levetzow David Myers
816 / 556-2926 816 / 556-2312
Phyllis Desbien
816 / 556-2903 Joele Frank / Tim Metz
Abernathy MacGregor Scanlon
212 / 371-5999
KCPL CHAIRMAN QUESTIONS VALUE OF
WESTERN'S HOSTILE OFFER
___________________________________________________
Kansas City, Missouri (April 30, 1996) -- Kansas City Power
& Light (NYSE: KLT) Chairman, President and CEO Drue
Jennings urged KCPL shareholders not to gamble their
investment on a hostile takeover attempt by Western
Resources Inc. which will not succeed. He recommended that
shareholders vote for the solid value of KCPL's pending
strategic merger with UtiliCorp United, Inc. (NYSE: UCU).
"We urge shareholders not to gamble their investment on a
hostile deal that is not going to happen," Mr. Jennings
said. "Western is waging an aggressive campaign to win the
votes of KCPL shareholders by making promises that shift
from day to day. Shareholders should vote for the solid
value of KCPL's pending strategic merger with UtiliCorp.
"Western's proposal is built on a shaky foundation that will
not survive the hard reality that no hostile takeover has
ever succeeded in the utility industry," Mr. Jennings said.
He noted in an April 29th letter to shareholders (attached)
that "it is unlikely that Western's offer will ever be
completed" since "there are a number of very significant
hurdles Western would have to overcome before it could
exchange a single share of KCPL stock."
These conditions include that the Western proposal secure
the tender of at least 90% of KCPL's outstanding shares;
that Western's own shareholders approve the transaction,
even though it may be dilutive to Western's earnings; and
that the Western proposal comply with Missouri's anti-
takeover laws requiring KCPL board approval.
(more)
Mr. Jennings said Western's credibility has been marred by
public shifts on issues such as: Western announcing a tax
free proposal then, in filings days later with the
Securities and Exchange Commission, admitting that the tax-
free status of its proposal is not free from doubt; Western
cutting its forecast of increased dividends within days
after its initial announcement; Western announcing that its
proposal would involve no layoffs, but the next day telling
Kansas regulators that 531 jobs would be eliminated.
Mr. Jennings said, "Western's credibility has also been
damaged by the high rates it has been charging its
customers. Western has been dodging its responsibility to
ratepayers for years, but time is running out. Western is
now in proceedings with the Kansas Corporation Commission
(KCC) for rate reductions. The staff of the KCC has already
stated that Western's rates are `unjust and unreasonable.'
Western now faces drastic rate reductions beyond the $8.7
million it has publicly forecast. We believe Western sought
to avoid public disclosure of this reality by postponing its
KCC rate review until after the shareholder vote on the
superior KCPL/UtiliCorp merger. We believe that when the
reality of these rate cuts is fully known, it will have an
immediate and long term negative impact on the value of
Western's stock and Western's ability to fulfill its
dividend promises.
"KCPL chose to merge with UtiliCorp after a long period of
evaluation. UtiliCorp has embarked on an innovative
strategy that we believe offers KCPL shareholders above
average growth in the utility industry of the future," Mr.
Jennings added. "KCPL and UtiliCorp combined will create a
growth company that can effectively compete in national and
global markets with a new array of energy products and
services. The new company will be uniquely positioned to
meet the challenges of a deregulated marketplace for power."
The text of the April 29, 1996 letter to KCPL shareholders
follows:
Dear Shareholder:
In its continuing attempt to block the formation of a strong
and formidable competitor, Western Resources is now
attempting to solicit proxies against the merger of Kansas
City Power & Light Company with UtiliCorp United, Inc.
Western's disruptive proxy contest, coupled with its highly
conditional exchange offer, is driven solely by its own
agenda, at your expense.
In contrast, the proposed merger of KCPL and UtiliCorp is a
strategic combination designed to build sustainable value
for you by enhancing growth in revenue and income in a
rapidly changing competitive marketplace. You are strongly
urged to vote for our merger with UtiliCorp by signing,
dating and mailing the enclosed WHITE proxy today.
(more)
In seeking to distract your attention from the benefits of
the KCPL/UtiliCorp merger, Western wants you to believe that
it is making a superior financial offer.
DON'T BE FOOLED. WESTERN IS NOT GUARANTEEING YOU
$28 PER KCPL SHARE.
Western proposes to exchange each of your KCPL shares for a
fractional share of its own common stock. They're telling
you that the value of the transaction is $28 a share -- but
that figure is speculative, based on a number of flawed
assumptions and "strings" that Western has tied to its
proposal.
Consider the following:
- Western's proposal contains a "collar," Wall Street
jargon for a mechanism which places the risk of any decline
in Western's stock price squarely on your shoulders. The
collar also makes it impossible to figure out what the
Western deal will be worth when -- and if -- it is ever
completed.
- Western admits its exchange offer may be fully taxable
to you at the federal level. In that case, its $28 a share
promise would be history.
- Kansas regulators are about to hit Western with rate
reductions that will have a negative effect on Western's
revenues and earnings and will not be good news for its
share value. While Western is trying to limit this
reduction to $8.7 million, intervenors such as the Citizens'
Utility Ratepayer Board have already said they will seek
substantially more. Western is trying to delay any further
action on rate reductions until after you vote on the
KCPL/UtiliCorp merger.
- Western's proposal assumes $500 million of "phantom"
cost savings. Western claims it can achieve $1 billion of
cost savings from its merger with your company. However,
less than a year ago, Western's same synergy experts arrived
at savings of only $500 million. Is Western inflating its
savings estimate in an attempt to support its stock price?
- Western's assumption that it will be able to keep 70
percent of cost savings is fiction. In other utility
mergers, regulators have allowed companies to keep only 50
percent of cost savings. In fact, Western itself is under
an order from Kansas regulatory officials to share savings
on a "50/50" basis with ratepayers.
(more)
In stark contrast to the Western proposal, the share-for-
share exchange in the merger of KCPL and UtiliCorp is fixed,
regardless of fluctuations in KCPL's or UtiliCorp's stock
price. You will get full benefit of any price appreciation
that occurs between now and consummation of the KCPL and
UtiliCorp merger. Plus, our proposed combination doesn't
depend on inflated cost savings estimates or overly
optimistic assumptions about sharing of these cost savings.
WESTERN'S DIVIDEND MAY BE SUBSTANTIALLY LESS THAN PROMISED
Western's promise of a so-called 23% dividend increase is
highly questionable.
Take a closer look:
- Western's ability to maintain its current dividend will
be threatened if Western can't achieve its forecast merger
savings and keep most of them. Remember, Western's proposal
is based on cost savings of more than twice Western's own
estimates less than a year ago. It also assumes that
regulators will allow it to keep a far greater percentage of
these savings than is realistic.
- Western's dividend will be further threatened by
adverse regulatory treatment. Remember, Western is using its
proposal as a delaying tactic to avoid what may be
inevitable -- cuts in electric rates that will further
reduce revenues and earnings.
Western cannot support the alleged value of its merger
proposal without grossly inflated estimates and unrealistic
merger assumptions. Western is betting that it can fool you
with a highly conditional promise of Western common stock
with dubious value and a dividend that may not be
sustainable. Western is hoping that its flawed assumptions
and empty promises will get you to give up the tangible
benefits and dividend safety of a KCPL/UtiliCorp merger.
IT IS UNLIKELY WESTERN'S OFFER WILL EVER BE COMPLETED
The fact is, there are a number of very significant hurdles
Western would have to overcome before it could exchange a
single share of KCPL stock. Here are just three of many:
1. At least 90 percent of KCPL's outstanding shares must
be tendered to Western. Given the legitimate questions
about the real value of Western's offer, is this realistic?
2. Western must receive approval from its own
shareholders. Once they understand that this deal could
erode their investment in Western stock, is this realistic?
(more)
3. Western's proposal must satisfy the Missouri Business
Combination law, which requires your board's approval.
Given the KCPL board's unanimous rejection of the Western
proposal, is this realistic?
Remember, Western has no fiduciary obligations to you. In
fact, Western is free to pursue its own personal and selfish
agenda by any means available to it. Your board of
directors and management believe you deserve better, which
is what you will get through a strategic merger of equals
with UtiliCorp.
The electric utility industry is facing intense competition
in a deregulated market. Prudently managed, forward-looking
utilities must adapt to this fundamental change by
developing effective long-term revenue and income growth
strategies. The combined KCPL and UtiliCorp will be a
growth company that can compete effectively in national and
global markets with a new array of energy products and
services. The new company will be uniquely positioned to
meet the challenges of a deregulated marketplace for power.
To us, and to your board, the choice is clear: KCPL/UtiliCorp.
YOUR VOTE IS IMPORTANT
Since the KCPL/UtiliCorp merger requires the affirmative
vote of two-thirds of KCPL's outstanding shares, the vote of
every shareholder is extremely significant. A failure to
vote is the same as a vote against the KCPL/UtiliCorp
merger. In your own best interest, you are earnestly
requested to vote FOR adoption of this merger by signing,
dating and returning the enclosed WHITE proxy card today.
Thank you.
Sincerely,
/s/ Drue Jennings
Drue Jennings
Chairman of the Board, President and Chief Executive Officer
Kansas City Power & Light Company provides electric power to
a growing and diversified service territory encompassing
metropolitan Kansas City and parts of eastern Kansas and
western Missouri. KCPL is a low-cost producer and leader in
fuel procurement and plant technology. KLT Inc., a wholly-
owned subsidiary of KCPL, pursues opportunities in non-
regulated, primarily energy-related ventures.
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