Westar, Pro One explore sale

SSN Staff  - 
Saturday, March 1, 2003

Financial advisors help both sides develop alternatives
TOPEKA, Kan. - In a continued effort to comply with a Kansas regulatory commission’s directive to reduce its debts, Westar Energy has retained financial advisors to help develop strategic alternatives for its 88 percent share of Protection One.

In addition, Protection One has also retained its own financial advisors to help guide the company through the process.

According to a release, a special committee comprised of independent members of Protection One’s board of directors has retained Bear, Stearns & Co. while Westar Energy has retained Lehman Bros.

Westar Energy, the largest electric utility in Kansas is currently facing a debt of approximately $3.6 billion.

The Kansas Corporation Commission (KCC), which regulates public utilities, and has been critical of Westar’s investment in outside businesses such as Protection One, has put pressure on Westar to divest itself of its interest in Protection One to reduce Westar’s debt.

James Haines, president and chief executive officer, said that Westar is looking to emerge from its debt and concentrate on its core electrical business.

“When the plan is fully implemented, Westar Energy will be a pure electric utility company with a sound capital structure and investment grade credit quality,” he said in a release.

No buyers have publicly stepped forward to express interest in acquiring all or part of Westar’s stake in Protection One.

Late last year, the KCC ordered Westar to separate its regulated utility businesses from its non-regulated businesses, including Protection One.

Westar is also in the process of exploring a sale of Protection One Europe, which it acquired about three years ago.

In a release, Protection One President and Chief Executive Officer Richard Ginsburg said that any action would be beneficial to the company’s stockholders and expressed confidence in the future of the company. “We are optimistic the progress Protection One employees have made over the last 20 months in improving the metrics of the business will be reflected in the alternatives developed for consideration by our special committee,” he said.