SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
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] Defintive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
IES INDUSTRIES INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[X] 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
<PAGE>
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:
$500,063
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(2) Form, Schedule or Registration Statement No.:
PRELIMINARY PROXY MATERIALS of WPL HOLDINGS, INC., IES INDUSTRIES INC.
and INTERSTATE POWER COMPANY, JOINT PROXY STATEMENT of WPL HOLDINGS,
INC., IES INDUSTRIES INC. and INTERSTATE POWER COMPANY AND PROSPECTUS
of WPL HOLDINGS, INC. and INTERSTATE POWER COMPANY, ON FORM S-4 FILE
NO. 333-07931, and SUPPLEMENT TO JOINT PROXY STATEMENT and PROSPECTUS
SUPPLEMENT, ON FORM S-4 amended by FORM S-4/A FILE NO. 333-10401
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(3) Filing Party:
IES INDUSTRIES INC, WPL HOLDINGS, INC and INTERSTATE POWER COMPANY
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(4) Date Filed:
JANUARY 18, 1996, JULY 11, 1996, AUGUST 19, 1996 and AUGUST
22, 1996
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<PAGE>
[MATERIALS SENT TO BRANCH MANAGERS AND REGISTERED REPRESENTATIVES]
August 22, 1996
Dear Branch Manager/Registered Representative:
In November 1995, IES Industries Inc. (IES), WPL Holdings, Inc. (WPLH) and
Interstate Power Co. (IPC) announced a merger to create a new regional
powerhouse, Interstate Energy Corporation. We believe the merger is in the best
interest of our shareholders, customers, employees and the Iowa communities we
have served for more than 100 years. Our shareholders are scheduled to vote on
this three-way strategic alliance during our annual meeting Thursday, September
5, in Cedar Rapids.
To help keep you informed about our strategic combination to form Interstate
Energy, we will hold meetings for registered representatives on Tuesday, August
27. Senior executives from IES, WPLH and IPC will be on hand to discuss the
benefits of our proposed merger and answer your questions about the three-way
strategic alliance.
The meetings will be held in the following locations at the times indicated on
the enclosed flier. We will be calling you soon to see if you will be attending
one of these meetings.
The merger agreement to form Interstate Energy offers substantial benefit for
holders of IES common stock. Under revised terms of the proposal, IES
shareholders will receive 1.14 shares of the new company for each IES share
currently held. In addition, it is anticipated that holders of IES common stock
will receive an initial annual cash dividend from IES valued at $2.25 for each
IES share now held.
We strongly believe it is in your clients' best interests to vote in favor of
the three-way strategic alliance. Every vote is important to help us create a
new regional energy company that will succeed in the competitive marketplace.
Clients who hold stock in "street name" must return their proxy cards directly
to your proxy department or its agent in order for their shares to be voted.
If you have any questions or would like more information about our strategic
three-way alliance, please call us at (319) 398-4475. Thank you.
Sincerely,
Dennis B. Vass
Treasurer and Principal Financial Officer
<PAGE>
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YOU'RE INVITED
IES Industries, WPL Holdings and Interstate Power
invite you to attend a meeting to learn more about the
strategic three-way alliance
to create Interstate Energy Corporation
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All meetings will be held on Tuesday, August 27
Cedar Rapids
7:30-9:00 a.m.
Wyndham Five Seasons
Hotel
Regency I
350 First Avenue NE
Dubuque
7:30-9:00 a.m.
Holiday Inn Five
Flags
Benbolt Room
450 Main Street
Des Moines
4:00-5:30 p.m.
Des Moines Marriott
Hotel
Cedar Rapids Room
700 Grand Avenue
Sioux City
4:00-5:30 p.m.
Hilton Sioux City
707 Fourth Street
Davenport
7:30-9:00 a.m.
Radisson Quad City
Plaza Hotel
Moline Room
111 East Second Street
Waterloo
4:00-5:30 p.m.
Holiday Inn Convention
Center
Conference Room B
205 West Fourth Street
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Please RSVP to IES Industries Inc by fax at (319) 398-4483 or by phone at (319)
398-4413.
For more information or answers to your questions, please contact Larry Duncan
at (319) 398-8151 or Joel Schmidt at (319) 398-4149.
<PAGE>
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YOU'RE INVITED
IES Industries, WPL Holdings and Interstate Power
invite you to attend a meeting to learn more about the
strategic three-way alliance
to create Interstate Energy Corporation
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All meetings will be held on Tuesday, August 27
Cedar Rapids
7:30-9:00 a.m.
Wyndham Five Seasons
Hotel
Regency I
350 First Avenue NE
Lee Liu, IES Chairman
Erroll Davis, WPLH Chairman
Mike Chase, IPC Exec VP
Denny Vass, IES Treasurer
Dubuque
7:30-9:00 a.m.
Holiday Inn Five
Flags
Ben Bolt Room
450 Main Street
Larry Root, IES Exec VP (Ret)
Wayne Stoppelmoor, IPC Chairman
Nino Amato, WPLH Sr. VP
Ed Gleason, WPLH Secretary
Des Moines
4:00-5:30 p.m.
Des Moines Marriott
Hotel
Cedar Rapids Room
700 Grand Avenue
Lee Liu, IES Chairman
Erroll Davis, WPLH Chairman
Mike Chase, IPC Exec VP
Denny Vass, IES Treasurer
Sioux City
4:00-5:30 p.m.
Hilton Sioux City
Cambridge Room
707 Fourth Street
Jim Hoffman, IES Exec VP
Eliot Protsch, WPLH Sr. VP
Joe McGowan, IPC Sec/Treas
John Ebright, IES Controller
Joel Schmidt, IES Mgr, Finance
Davenport
7:30-9:00 a.m.
Radisson Quad City
Plaza Hotel
Moline Room
111 East Second Street
Jim Hoffman, IES Exec VP
Eliot Protsch, WPLH Sr. VP
Joe McGowan, IPC Sec/Treas
John Ebright, IES Controller
Joel Schmidt, IES Mgr, Finance
Waterloo
4:00-5:30 p.m.
Holiday Inn Convention
Center
Conference Room B
205 West Fourth Street
Larry Root, IES Exec VP (Ret)
Wayne Stoppelmoor, IPC Chairman
Nino Amato, WPLH Sr. VP
Ed Gleason, WPLH Secretary
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Please RSVP to IES Industries Inc. by fax at (319) 398-4483 or by
phone to (319) 398-4413.
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<PAGE>
[MATERIALS SENT TO IES EMPLOYEES]
August 22, 1996
Dear Fellow Employees:
We have embarked on a new battle.
For months now we've been promoting our company's commitment to customers and
the communities we serve. "We Put Our Pride On The Line. Every Day" has been the
rallying cry in advertisements and other promotional materials. IES Industries
has a long heritage of supporting Iowa. I am proud of that commitment and I know
many of you are as well. As we work to complete our merger with WPL Holdings and
Interstate Lower Co., we will emphasize our history of success and our pledge to
continue to expand on our Iowa roots.
The enclosed flier provides additional information about the IES Board of
Directors' decision last week. Feel free to share the information with your
neighbors, friends, family, customers, shareholders and communities. If you'd
like additional copies to distribute, please contact Corporate Communications at
319-398-4350.
We are dedicated to completing the strategic three-way alliance, which we
believe is in the best interest of IES shareholders, employees, customers and
the communities we have served for more than 100 years. The proxy fight
currently underway will make things a little more turbulent before Interstate
Energy becomes a reality. Nevertheless, we will move quickly to capture the
strategic value that will accrue from the IES/WPLH/IPC combination.
On behalf of all of our senior executives, let me thank you for your continued
enthusiasm, extraordinary effort and support during these times. I encourage you
to continue to work safely and stay focused on our primary task: providing
exceptional service to our customers. Thanks again.
Very truly yours,
Lee Liu
Chairman of the Board,
President & Chief Executive Officer
<PAGE>
The MidAmerican Deal: Less Than Advertised
How Will MidAmerican MidAmerican's Bid MidAmerican Hasn't
Pay For Almost Half- Could Hurt Its Own Kept Its Word.
A-Billion Dollars of Shareholders.
Debt It May Take On?
MidAmerican's MidAmerican's In its last merger,
preliminary proxy preliminary proxy MidAmerican said it
statement indicates statement fails to would reduce
it intends to pay talk about the employment by 250
for this takeover impact on earnings positions. In fact
the same way the per share for its they shed 850
corporate raiders of shareholders under positions in Iowa.
the 1980's did-- the hostile takeover MidAmerican's
through asset sales plan. Even if one dividend is less
and layoffs of assumes MidAmerican than it was 5 years
Iowans. How else? can achieve the ago. They promised
Increased rates for synergies it claims-- that a previous
customers? What is and we don't--we merger would lead to
MidAmerican's plan think the deal would higher dividends but
for how much Iowans dilute MidAmerican's they ended up
will pay for energy earnings per share cutting it instead.
supplied by a in the first year What does this say
combined MidAmerican and beyond. about their promises
and IES? to IES shareholders
and Iowa today?
Take a closer look: MidAmerican's deal is an inferior deal for IES shareholders,
MidAmerican shareholders and Iowans.
<PAGE>
The IES Industries What Can You Do? The
Board of Directors
carefully analyzed As an IES Industries MidAmerican
MidAmerican's employee, you can
hostile takeover cast your vote in
proposal and found a favor of the three- Deal:
whole lot less than way strategic
advertised. alliance to form
Interstate Energy. Less Than
Talk with your
neighbors, friends,
family, customers Advertised
and business
associates and
The Truth is, encourage them to ________
MidAmerican's Bid support the merger
Isn't What it among IES, WPL
Claims. Holdings and
Interstate Power Co.
Every YES vote
counts in creating
our vision for
Interstate Energy
Corporation.
When you consider IES Industries Shareholders of IES
recent trading Idustries have an
prices of We Put Our Pride On opportunity to vote
MidAmerican stock, The Line. Every to create a new
the fact that most Day. regional powerhouse,
IES shareholders who Interstate Energy
take the cash option Corporation. The
would incur a tax YES vote is in the
liability and the best interest of IES
fact that even with shareholders,
the most rapid employees and
regulatory approval customers and the
process, the State of Iowa.
MidAmerican
transaction could
take substantially
longer to complete
than ours, the value
of MidAmerican's
proposal is
considerably less
than MidAmerican
represents.
<PAGE>
QUESTIONS AND ANSWERS FOR IES EMPLOYEES
------------------------
Q. What's the news?
On August 16, 1996, IES Industries, WPL Holdings and Interstate Power
Co. announced revised terms of their merger agreement to form a regional
powerhouse, Interstate Energy Corp.
At the same time, the IES Board of Directors also rejected the hostile
takeover proposal from MidAmerican Energy Co. of Des Moines, concluding that the
three-way strategic merger with WPL Holdings and Interstate Power Co. is still
in the best interests of IES shareholders. The Board also viewed with concern
the impact of the proposed MidAmerican transaction on customers, employees and
the communities IES has served for more than 100 years.
Q: How is the stock-exchange ratio being changed?
Under the terms of the revised agreement, each share of IES common
stock would be converted to 1.14 shares of Interstate Energy common stock. Based
on the closing price of WPLH common stock on August 15, 1996, each share of IES
common stock is valued at $36.20 per share, under the new terms. In addition,
based on WPLH's current dividend rate, it is anticipated that, under the new
terms, IES shareholders will receive an initial cash dividend of at least $2.25
for each share of IES common stock now held.
Q: Who does the new stock-exchange ratio apply to?
The new exchange ratio only applies to IES shareholders. Shareholders
of Interstate Power Co. will still receive 1.11 shares of Interstate Energy
Corp. common stock for each share of Interstate Power stock, while WPL Holdings
shares will remain outstanding as an identical number of Interstate Energy Corp.
shares.
Q: What is the value of the new exchange ratio to IES shareholders?
The new exchange ratio translates into a value of approximately $36.20
per IES share, based on the August 15 WPL Holdings closing price of $31.75. The
value to IES shareholders is affected by the WPL Holdings stock price because
the merger agreement calls for WPL Holdings shares to be issued in the merger.
WPL Holdings will be renamed as Interstate Energy Corporation at the time of the
merger.
Q: Why was the stock-exchange ratio changed? Why wasn't the exchange ratio
changed earlier?
<PAGE>
The ratio was primarily changed in response to the hostile takeover
proposal by MidAmerican Energy Co. It represents the three-way merger partners'
commitment to IES's shareholders and to the value and strength of the strategic
three-way merger.
Q: What the IES Board of Directors consider when making its decision?
The IES Board looked at a large number of issues when making its
evaluation. Those issues included:
o how the proposal would financed, especially since it promises a
purchase premium, dividend increase and revenue reduction;
o the effect on debt levels of the company, given the amount that
MidAmerican would have to borrow to consummate the purchase;
o the effect on future dividends, given the history of MidAmerican
dividend reductions;
o the proposal's effect on customer rates;
o the future business prospects for a company largely confined to one
state jurisdiction;
o the long-term performance outlook for the stock;
o the plans to divest substantial diversified businesses to help pay for
the purchase; and
o the impact on employment levels in Iowa.
Q: Does it make sense for us to fight a hostile takeover attempt from
MidAmerican?
We feel that the benefits of the strategic three-way alliance so
dramatically outweigh the MidAmerican proposal that we have a clear
responsibility to communicate those benefits to shareholders.
Q: What if shareholders reject the IES/WPH/IPC merger? what will IES do
next?
First, we are going to work very hard to be sure shareholders
understand the long-term benefits of the strategic three-way alliance so they
support it. In the event that shareholders reject the three-way merger, however,
the IES Board of Directors will continue to evaluate all available strategic
alternatives.
<PAGE>
Q: If I am an employee and shareholder, how does the company suggest I
vote my proxy?
The IES Board of Directors has recommended that shareholders approve
the proposed strategic three-way alliance with WPL Holdings and Interstate Power
Co. After conducting its extensive analysis, the Board felt that the strategic
three-way alliance would provide better long-term value for shareholders.
Q: When I receive a proxy, what is the process for sending in my vote?
IES shareholders will receive a total of three proxy cards. The first
card (white, blue or green) from IES was sent with the proxy in late July. The
second card (blue) from MidAmerican was sent in mid-August. The third card from
IES will be sent in late August.
Only the last proxy card received counts as a vote. If you return all
three cards, the vote reflected on the last card received will be counted and
the other two will not be. If you have voted with the first card, and you do not
send any other cards, that vote still counts. It is important that you return
your proxy card if you support the strategic three-way alliance. Not returning a
card in favor of the three-way merger counts the same as a "no" vote.
Please remember to sign and date your proxy card.
It is important to note that shareholders can vote their shares during
the shareholder meeting.
Q: What should we be telling our customers about all of this?
We have tried to communicate with customers that our focus continues to
be on their needs at this time. There are a number of changes underway, but our
focus simply must be providing customers with safe and reliable energy service.
Regardless of the outcome of the shareholder votes, we must continue to keep
safety and customers' needs at the forefront.
Q: Will the 1996 IES Industries annual meeting still take place as
scheduled on September 5?
We currently anticipate that the 1996 IES Industries annual meeting
will be held as scheduled on Thursday, Sept. 5, at the Collins Plaza Hotel and
Convention Center in Cedar Rapids. All IES Industries shareholders will soon
receive supplemental proxy materials reflecting the new stock-exchange ratio.
Q: How can employees become more involved in fighting the hostile takeover
attempt?
The first step is sign, date and send in your proxy card so that your
shares can be voted. In addition, IES will be sponsoring employee events to give
employees the opportunity to voice their support for the strategic three-
<PAGE>
way alliance. In addition, employees have been very helpful, providing their
own, customers' and communities' comments and suggestions to Corporate
Communications. That information helps us understand the prevailing attitude of
our key groups. We welcome your continued comments and suggestions to help be
sure we are doing the best possible job communicating the issues.
Q: Who can employees call with further questions or comments?
Employees can call the Interstate Energy Corp. Merger Hotline at 1-800-
818-2041. Questions will be addressed in future communications.
<PAGE>
[MATERIALS SENT TO IES SHAREHOLDERS]
IES INDUSTRIES, INC.
Dear Stockholder:
Please accept our thanks for sending in your WHITE Proxy Card.
To avoid the possibility of the validity of your WHITE Proxy Card being
challenged or disqualified for the reason(s) indicated below, we are requesting
that you sign, date and mail the enclosed new WHITE Proxy Card with the
correction indicated below in the self-addressed envelope provided for your
convenience. This WHITE Proxy Card will automatically revoke any previous WHITE
Proxy Card when it is returned to us.
o Your previous WHITE Proxy was unsigned. (If signing as attorney,
executor, administrator, personal representative of the estate,
corporate officer, partner, trustee, custodian or guardian, please sign
and give your full title as such.)
o Your previous WHITE Proxy was undated. (Please date, sign and return
the new proxy in the enclosed envelope.)
o Your previous WHITE Proxy omitted your title or authority. (If signing
as attorney, executor, administrator, personal representative of the
estate, corporate officer, partner, trustee, custodian or guardian,
please sign and give your full title as such.)
o Your previous WHITE Proxy, as signed, did not conform to the name shown
on the Proxy. (Please date and sign this WHITE Proxy Card exactly as
the registration appears on the revocation, including your full title
if signing other than in an individual capacity.) If the registration
is in the name of a custodian for the benefit of a minor, the custodian
must sign and indicate their capacity. If you are a beneficiary 18
years or older, you may sign as long as you indicate your age.
o Your previous WHITE Proxy was not signed by all joint owners. (If
shares are registered in the name of more than one person, each such
person should sign the Proxy Card. If a joint tenant is deceased,
please indicate that you are the surviving joint owner.)
o Other------------------------------------------------------------------
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Since time is of the essence, we would greatly appreciate your signing, dating
and mailing the enclosed WHITE Proxy Card as soon as possible. Please mail it in
the envelope provided for your convenience. Once again, we greatly appreciate
your support.
Sincerely,
IES INDUSTRIES, INC.
<PAGE>
