<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. __)*
KU ENERGY CORPORATION
---------------------
(Name of Issuer)
Common Stock, without par value
-------------------------------
(Title of Class of Securities)
482734-10-0
-----------
(CUSIP Number)
John R. McCall
LG&E ENERGY CORP.
220 West Main Street
Louisville, Kentucky 40202
(502) 627-2000
With a Copy to:
Peter D. Clarke
Gardner, Carton & Douglas
321 North Clark Street
Chicago, Illinois 60610
(312) 245-8685
------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 20, 1997
------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [].
NOTE: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the reminder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
1
<PAGE>
- -----------------------
CUSIP NO. 482734-10-0 13D
- -----------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSONS
1 S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
LG&E Energy Corp.
61-1174555
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [ ]
(b) [ ]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
WC, OO
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(c) [ ]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Kentucky
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
7,525,857
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
7,525,857
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
- ------------------------------------------------------------------------------
2
<PAGE>
- -----------------------
CUSIP NO. 482734-10-0 13D
- -----------------------
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
7,525,857
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[ ]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
19.9%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
3
<PAGE>
Item 1. Security and Issuer.
This statement relates to the common stock, without par value (the "KU
Energy Common Stock"), of KU Energy Corporation, a Kentucky corporation ("KU
Energy"). The principal executive office of KU Energy is located at One Quality
Street, Lexington, Kentucky 40507.
Item 2. Identity and Background.
(a)-(c) This statement is being filed by LG&E Energy Corp., a Kentucky
corporation ("LG&E Energy"). The principal executive office of LG&E Energy is
located at 220 West Main Street, Louisville, Kentucky 40202. LG&E Energy is a
diversified energy services and marketing company with businesses in retail
utility services, energy marketing and trading, power generation and project
development. LG&E Energy has three direct subsidiaries: Louisville Gas and
Electric Company ("LG&E"), an operating public utility company; LG&E Energy
Systems Inc.; and LG&E Gas Systems Inc.
Pursuant to General Instruction "C" for Schedule 13D, the attached Annex 1
to this statement sets forth certain information concerning all of the executive
officers and directors of LG&E Energy. The contents of Annex 1 are incorporated
herein by reference.
(d) During the last five years, neither LG&E Energy nor, to the best of
LG&E Energy's knowledge, any of the executive officers or directors of LG&E
Energy named in Annex 1 has been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors).
(e) During the last five years, neither LG&E Energy nor, to the best of
LG&E Energy's knowledge, any of the executive officers or directors of LG&E
Energy named in Annex 1 has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
4
<PAGE>
(f) All of the executive officers and directors identified in Item 2 are
citizens of the United States.
Item 3. Source and Amount of Funds or Other Consideration.
Concurrent with entering into the Merger Agreement (as defined in Item 4
below), LG&E Energy and KU Energy entered into the KU Energy Stock Option
Agreement (as defined in Item 4 below), whereby LG&E Energy has the right to
purchase up to 7,525,757 shares of the KU Energy Common Stock upon the terms and
subject to the conditions of the KU Energy Stock Option Agreement. As of the
date of this statement, none of the triggering events permitting exercise of the
stock option provided for in the KU Energy Stock Option Agreement has occurred.
In the event that the stock option becomes exercisable under the KU Energy Stock
Option Agreement and LG&E Energy wishes to purchase for cash the KU Energy
Common Stock subject thereto, LG&E Energy will fund the exercise price from
working capital or through other sources, which could include borrowings.
Item 4. Purpose of Transaction
On May 20, 1997, LG&E Energy and KU Energy entered into an Agreement and
Plan of Merger (the "Merger Agreement") providing for a merger of LG&E Energy
and KU Energy. Pursuant to the Merger Agreement, KU Energy will be merged with
and into LG&E Energy, with LG&E Energy as the surviving corporation (the
"Merger"). The Merger, which was unanimously approved by the Boards of Directors
of LG&E Energy and KU Energy, is expected to close shortly after all of the
conditions to consummation of the Merger, including the receipt of all
applicable regulatory and shareholder approvals, are met or waived.
The Merger Agreement and the related Stock Option Agreements (as defined in
Item 4 below) are incorporated herein by reference to Exhibits 2, 99.1 and 99.2
to the Current Report on Form 8-K, dated May 30, 1997, filed by LG&E Energy with
the Securities and Exchange Commission (the "Commission") on such date. The
joint press release issued in connection with the Merger Agreement is
incorporated herein by reference to Exhibit 99.01 to the Current Report on Form
8-K, dated May 21, 1997, filed by LG&E Energy with the Commission on May 22,
1997. The descriptions of the Merger
5
<PAGE>
Agreement and the Stock Option Agreements set forth herein do not purport to be
complete and are qualified in their entirety by the provisions of the Merger
Agreements and the Stock Option Agreements.
As a result of the Merger, LG&E Energy, which is the parent of LG&E, a
Kentucky corporation, will become the parent company of Kentucky Utilities
Company ("Kentucky Utilities"), currently the operating utility subsidiary of KU
Energy. The operating utility subsidiaries (LG&E and Kentucky Utilities) will
remain separate companies and will continue to serve customers in Kentucky and
Virginia under their present names. The preferred stock and debt securities of
the operating utility subsidiaries will not be affected by the Merger. Present
nonutility operations of LG&E Energy will be unaffected. The nonutility
subsidiaries of KU Energy will become subsidiaries of LG&E Energy.
Under the terms of the Merger Agreement, each outstanding share of the
common stock, without par value, of KU Energy ("KU Energy Common Stock") (other
than shares with respect to which dissenters' rights are perfected under
applicable state law), together with the associated KU Energy stock purchase
rights, will be converted into the right to receive 1.67 shares of LG&E Energy
Common Stock, together with the associated LG&E Energy stock purchase rights. A
holder of KU Energy Common Stock who would otherwise have been entitled to a
fractional share of LG&E Energy Common Stock will be entitled to receive a cash
payment in lieu of such fractional share. The outstanding shares of LG&E Energy
Common Stock will remain unchanged and outstanding. As of May 16, 1997, there
were 37,817,878 shares of KU Energy Common Stock outstanding and 66,484,875
shares of LG&E Energy Common Stock outstanding. Based on such capitalization,
upon consummation of the Merger, 51.3% of the outstanding LG&E Energy Common
Stock will be owned by the shareholders of LG&E Energy prior to the Merger and
48.7% will be owned by former KU Energy shareholders.
The Merger is subject to customary closing conditions, including, without
limitation, the approval of the holders of a majority of the outstanding shares
of each of the LG&E Energy Common Stock and the KU Energy Common Stock, the
receipt of all necessary governmental approvals and the making of all necessary
6
<PAGE>
governmental filings, including approvals of various regulators in Kentucky and
Virginia under state utility laws, the approval of the Federal Energy Regulatory
Commission under the Federal Power Act, the approval of the Commission under the
Public Utility Holding Company Act of 1935, and the filing of requisite
notifications with the Federal Trade Commission and the Department of Justice
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and
the expiration of all applicable waiting periods thereunder. The Merger is also
subject to the receipt of opinions of counsel that the Merger will qualify as a
tax-free reorganization and assurances from the parties' independent accountants
that the Merger will qualify as a pooling of interests for accounting purposes.
In addition, the Merger is conditioned upon the effectiveness of a registration
statement to be filed with the Commission with respect to the shares of LG&E
Energy Common Stock to be issued in the Merger and the approval for listing of
such shares on the New York Stock Exchange. It is anticipated that LG&E Energy,
as parent of Kentucky Utilities and LG&E, will continue to be an exempt holding
company under the Public Utility Holding Company Act of 1935. Shareholder
meetings to vote upon approval of the Merger will be convened as soon as
practicable and are expected to be held later in 1997.
Simultaneously with the execution and delivery of the Merger Agreement,
LG&E Energy and KU Energy also entered into reciprocal stock option agreements
(the "LG&E Energy Stock Option Agreement" and the "KU Energy Stock Option
Agreement", collectively, the "Stock Option Agreements"). Pursuant to the Stock
Option Agreements, LG&E Energy and KU Energy each grant to the other an
irrevocable option to purchase up to 19.9% of the granting company's outstanding
common stock, at an exercise price per share equal to (i) in the case of LG&E
Energy Common Stock, $24.45 (which price per share equals the average of the
daily closing sales price per share of the LG&E Energy Common Stock on the New
York Stock Exchange during the ten-day period ending May 12, 1997) and (ii) in
the case of KU Energy Common Stock, $40.83 (which price per share equals the
exercise price per share of the option covering LG&E Energy Common Stock
multiplied by an exchange ratio of 1.67). The option becomes exercisable if the
Merger Agreement becomes terminable by either LG&E Energy or KU Energy in
circumstances that could entitle such party to receive specified termination
fees, generally as a result of the other
7
<PAGE>
party becoming the subject of a third party tender offer or business combination
proposal.
If its option becomes exercisable, either LG&E Energy or KU Energy may
request the other party to repurchase all or part of its option at a price per
share equal to the spread between the exercise price and the highest average
trading price or the offered price in any business combination proposal. Under
the Merger Agreement, the aggregate amount of any termination fees and
transaction expenses payable, plus any amounts payable as a result of the
required repurchase of options, is limited to a maximum amount of $70 million.
Except as set forth in this Item 4, the Merger Agreement or the Stock
Option Agreements, neither LG&E Energy nor, to the best of LG&E Energy's
knowledge, any of the executive officers and directors of LG&E Energy named in
Annex 1 has any plans or proposals which relate to or which would result in any
of the actions specified in clauses (a) through (j) of Item 4 of this statement.
Item 5. Interest in Securities of the Issuer.
(a)-(b) Prior to entering into the KU Energy Stock Option Agreement, LG&E
Energy beneficially owned 100 shares of KU Energy Common Stock. By reason of its
execution of the KU Energy Stock Option Agreement, pursuant to Rule 13d-
3(d)(1)(i) promulgated under the Securities Exchange Act of 1934, as amended,
LG&E Energy may be deemed to have sole voting and dispositive power with respect
to the 7,525,757 shares of KU Energy Common Stock subject to the KU Energy Stock
Option Agreement and, accordingly, may be deemed to beneficially own
approximately 19.9% of the KU Energy Common Stock outstanding, assuming exercise
of the stock option. However, LG&E Energy expressly disclaims any beneficial
ownership of the shares of KU Energy Common Stock which are obtainable by LG&E
Energy upon exercise of the stock option, because the stock option is
exercisable only in the circumstances referred to in Item 4 and as described in
the KU Energy Stock Option Agreement, none of which has occurred as of the date
hereof. Furthermore, even if events did occur which rendered such stock option
exercisable, LG&E Energy believes it would be a practical impossibility to
obtain the regulatory approvals
8
<PAGE>
necessary to acquire shares of KU Energy Common Stock pursuant to the stock
option within 60 days.
Except as set forth above, neither LG&E Energy nor, to the best of LG&E
Energy's knowledge except as set forth in the following sentence, any of the
executive officers and directors of LG&E Energy named in Annex 1 owns any KU
Energy Common Stock. As of the date hereof, Roger W. Hale, Chairman and Chief
Executive Officer of LG&E Energy and John R. McCall, Executive Vice President,
General Counsel and Corporate Secretary of LG&E Energy, each beneficially own
not more than 100 shares of KU Energy Common Stock.
(c) Except as set forth above, neither LG&E Energy nor, to the best of LG&E
Energy's knowledge, any of the executive officers and directors of LG&E Energy
named in Annex 1 has effected any transaction in the KU Energy Common Stock
during the past 60 days.
(d) So long as LG&E Energy has not purchased the KU Energy Common Stock
subject to the KU Energy Stock Option Agreement, LG&E Energy does not have the
right to receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, any of the KU Energy Common Stock (other than the
100 shares of KU Energy Common Stock described in Item 5(a)).
(e) Inapplicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer
---------------------------------------------------------------------
The Merger Agreement contains certain customary restrictions on the conduct
of the business of LG&E Energy and KU Energy pending the Merger, including
certain customary restrictions relating to the KU Energy Common Stock. Except as
provided in the Merger Agreement, the KU Energy Stock Option Agreement or as set
forth herein, neither LG&E Energy nor, to the best of LG&E Energy's knowledge,
any of the executive officers and directors of LG&E Energy named in Annex 1 has
any contracts, arrangements, understandings or relationships (legal or
otherwise), with any person with respect to any securities of KU Energy,
including, but not limited to, transfer or voting of any securities, finder's
fees, joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division of profits or losses, or the giving or withholding of proxies.
9
<PAGE>
Item 7. Material to be Filed as Exhibits.
--------------------------------
Exhibit Description
------- -----------
2 Agreement and Plan of Merger,
dated as of May 20, 1997,
by and between KU Energy and
LG&E Energy (Incorporated by
reference to Exhibit 2 to LG&E
Energy (Commission File No. 1-10568)
Current Report on Form 8-K, filed
with the Commission on May 30, 1997).
99.1 Joint Press Release, dated
May 21, 1997, of KU Energy
and LG&E Energy (Incorporated by
reference to Exhibit 99.1 to LG&E
Energy (Commission File No. 1-10568)
Current Report on Form 8-K, filed
with the Commission on May 22, 1997).
99.2 KU Energy Stock Option Agreement, dated
as of May 20, 1997, by and
between KU Energy and LG&E
Energy (Incorporated by
reference to Exhibit 99.1 to LG&E
Energy (Commission File No. 1-10568)
Current Report on Form 8-K, filed
with the Commission on May 30, 1997).
99.3 LG&E Energy Stock Option Agreement, dated
as of May 20, 1997, by and
between LG&E Energy and KU
Energy (Incorporated by
reference to Exhibit 99.2 to LG&E
Energy (Commission File No. 1-10568)
Current Report on Form 8-K, filed
with the Commission on May 30, 1997).
10
<PAGE>
SIGNATURE
---------
After reasonable inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
LG&E ENERGY CORP.
By:/s/ Victor A. Staffieri
-----------------------
Name: Victor A. Staffieri
Title: Chief Financial Officer
Dated: May 30, 1997
11
<PAGE>
Annex 1
-------
Set forth below are the names, titles and present principal occupations for
each of the executive officers and directors of LG&E Energy. The business
address for each of the following individuals is 220 West Main Street,
Louisville, Kentucky 40202.
Name and Title Principal Occupation
- -------------- --------------------
Roger W. Hale President and Chief Executive Officer
Chairman of the Board, LG&E Energy
President and Chief
Executive Officer
William C. Ballard, Jr. Of Counsel, Greenebaum Doll & McDonald
Director (Legal Affairs), Louisville, KY
Ronald L. Bittner Chairman and Chief Executive Officer of Frontier
Director Corporation (Communications)
Rochester, NY
Owsley Brown II Chairman and CEO, Brown-Forman
Director Corporation (Consumer Products), Louisville, KY
S. Gordon Dabney Business Consultant, formerly President, Standard
Director Foods, Inc. (Food Processing), Louisville, KY
Gene P. Gardner Chairman, Beaver Dam Coal Company (Coal
Director Properties), Louisville, KY
J. David Grissom Chairman, Mayfair Capital, Inc. (Investments),
Director Louisville, KY
David B. Lewis Chairman and Founding Partner, Lewis, Clay &
Director Munday, a Professional Corporation (Legal
Affairs), Detroit, MI
12
<PAGE>
Anne H. McNamara Senior Vice President and General Counsel, AMR
Director Corporation (Airline Holding Company) and American
Airlines, Inc. Dallas, TX
T. Ballard Morton, Jr. Executive in Residence, University of Louisville,
Director College of Business and Public Administration
(Higher Education), Louisville, KY
Dr. Donald C. Swain President (Emeritus) University of Louisville
Director (Higher Education), Louisville, KY
John R. McCall Executive Vice President, General Counsel and
Executive Officer Corporate Secretary, LG&E Energy, LG&E
Stephen R. Wood President-Distribution Services, LG&E Energy,
Executive Officer President, LG&E
Charles A. Markel Vice President-Finance, and Treasurer, LG&E Energy
Executive Officer
Victor A. Staffieri Chief Financial Officer, LG&E Energy, LG&E
Executive Officer
Wendy C. Heck Vice President-Administration, LG&E Energy, LG&E
Executive Officer
Walter Z. Berger Group President-Energy Marketing, LG&E Energy
Executive Officer
George W. Basinger Senior Vice President-Power Operations, LG&E Energy
Executive Officer
S. Bradford Rives Vice President-Finance, and Controller, LG&E Energy
Executive Officer
13
<PAGE>
INDEX TO EXHIBITS
Exhibit Description
- ------- -----------
2 Agreement and Plan of Merger, dated as of May 20, 1997, by and between
KU Energy and LG&E Energy (Incorporated by reference to Exhibit 2 to
LG&E Energy (Commission File No. 1-10568) Current Report on Form 8-K,
filed with the Commission on May 30, 1997).
99.1 Joint Press Release, dated May 21, 1997, of KU Energy and LG&E Energy
(Incorporated by reference to Exhibit 99.01 to LG&E Energy (Commission
File No. 1-10568) Current Report on Form 8-K, filed with the
Commission on May 22, 1997).
99.2 KU Energy Stock Option Agreement, dated as of May 20, 1997, by and
between KU Energy and LG&E Energy (Incorporated by reference to
Exhibit 99.1 to LG&E Energy (Commission File No. 1-10568) Current
Report on Form 8-K, filed with the Commission on May 30, 1997).
99.3 LG&E Energy Stock Option Agreement, dated as of May 20, 1997, by and
between LG&E Energy and KU Energy (Incorporated by reference to
Exhibit 99.2 to LG&E Energy (Commission File No. 1-10568) Current
Report on Form 8-K, filed with the Commission on May 30, 1997).
14
