Exhibit 99
RELEASE DATE NEWS RELEASE
July 11, 2000 FOR INFORMATION CONTACT:
Mark T. Thies
Senior Vice President and
Chief Financial Officer
(605) 721-2331
Black Hills Corporation Completes Acquisition of Indeck Capital
New Company Named Black Hills Energy Capital, Inc.
Rapid City, South Dakota--Black Hills Corporation (NYSE: BKH) announced today
that it has completed its acquisition of Indeck Capital, Inc., merging it into
Black Hills Energy Capital, Inc. The new entity will own varying interests in 14
operating independent power plants in California, New York, Massachusetts,
Colorado and Idaho totaling approximately 350 megawatts (MW), and will also
manage fund equity of approximately $750 million in six power-related funds. The
power funds have investments in over 35 power projects throughout the United
States and various foreign countries. The Indeck transaction, first announced in
January, is the largest acquisition by Black Hills Corporation to date.
"We're proud to provide electricity to some of the major population centers
of the United States," said Daniel P. Landguth, Chairman and Chief Executive
Officer of Black Hills Corporation. "This significant acquisition is consistent
with our independent energy growth strategy at Black Hills. Wholesale
electricity generation, along with our coal, natural gas, and crude oil
production and marketing operations, is a significant growth engine for our
Company's future. Our independent energy and telecommunications ventures build
upon the solid foundation of our regulated electric utility, and provide
tremendous opportunities for our corporation."
Along with the operating projects and funds, Public Service Company of
Colorado has awarded Black Hills Energy Capital two additional independent power
projects totaling 90 MW to be built in the Front Range of Colorado. The parties
are currently negotiating the necessary documents to finalize the project, and
Black Hills has placed an order to purchase the required equipment. It is
currently anticipated that the projects will have 10-year contracts from Public
Service of Colorado, and the plants are scheduled to come on line in the second
quarter of 2002. Black Hills Energy Capital has over 550 MW in various stages of
development, and will continue to evaluate acquisition transactions that help
achieve its strategic plan.
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Industry veteran John Salyer and his management team will be retained by
Black Hills, with Salyer serving as President and Chief Operating Officer of
Black Hills Energy Capital, Inc. Gerald R. Forsythe, former majority shareholder
of Indeck Capital, Inc., was elected to the Board of Directors of Black Hills
Corporation and will be its largest shareholder. Mr. Forsythe is Chairman and
Chief Executive Officer of a family of energy-related companies that operate
under the Indeck name. Mr. Forsythe has over 30 years of extensive experience in
steam generating and electricity generating power plant equipment, and was the
originator of the concept of trailer-mounted mobile steam generating and
electricity generating systems. Under his leadership, the Indeck companies have
grown into North America's largest emergency and back-up steam generating
source, and have branched out into designing and fabricating water treatment
equipment and renting generator sets, chillers, and compressors.
In conjunction with the closing of this acquisition, Black Hills'
Independent Energy business unit closed a new revolving credit facility. ABN
AMRO N.V. and Scotia Bank acted in concert to provide a $115 million credit
facility with three participating banks to provide flexibility in financing
future growth in the independent energy business unit. In addition, Scotia Bank
is acting as Agent bank for a $60 million non-recourse project financing in
conjunction with the Black Hills/Arapahoe (80 MW) and Black Hills/Valmont (40
MW) projects which were recently declared commercial. This financing will
replace existing short-term debt, and is expected to close in the third quarter.
The acquisition is a stock transaction, and will be accounted for under the
purchase method of accounting. Black Hills anticipates that the acquisition will
be accretive to earnings per share. Black Hills Corporation issued approximately
1.54 million shares of common stock to the shareholders of Indeck in the
acquisition priced at $22.13 per share (approximately 7 percent of Black Hills
Corporation's common stock after the transaction), along with $4 million in
preferred stock. Additional consideration, consisting of common and preferred
stock, may be paid in the form of an earn-out over a four-year period. The
earn-out consideration will be based on the acquired company's earnings during
the next four years and cannot exceed $35.0 million in total.
PricewaterhouseCoopers Securities LLC served as exclusive financial advisor
to Black Hills Corporation on this transaction.
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Black Hills Corporation (http://www.blackhillscorp.com) is an energy and
communications company with three functional business units. Black Hills Power
and Light supplies electric utility service in western South Dakota,
northeastern Wyoming, and southeastern Montana. Black Hills FiberCom markets
communications services in Rapid City and the Northern Black Hills of South
Dakota. The Independent Energy business unit engages in the production of
electricity, coal, crude oil and natural gas, primarily in the Rocky Mountain
region, and the related marketing of such products in various markets throughout
the United States. -30-
Note: The above information includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. All statements other
than statements of historical fact in this press release, which address
activities, events, or developments which the Company expects or anticipates
will or may occur in the future are forward-looking statements, including
without limitation the statements concerning the expansion of its Independent
Energy assets, the forecast success of the assets acquired, those under
development pending negotiation of the necessary contracts and those anticipated
to be developed. Although the Company believes that the expectations and
assumptions reflected in these statements are reasonable, there can be no
assurance that these expectations will prove to be correct. These
forward-looking statements involve a number of risks and uncertainties, and
actual results may differ materially from the results discussed in the
forward-looking statements. Any such forward-looking statements should be
considered in conjunction with Black Hills Corporation's 1999 Form 10-K and
interim quarterly reports on file with the SEC. New factors that could cause
actual results to differ materially from those described in forward-looking
statements emerge from time to time, and it is not possible for the Company to
predict all such factors, or the extent to which any such factor or combination
of factors may cause actual results to differ from those contained in any
forward-looking statement. The Company assumes no obligation to update publicly
any such forward-looking statements, whether as a result of new information,
future events, or otherwise.
