<PAGE>
EXHIBIT F-3.2
THE POWERGEN PLC PROPOSED STRUCTURE FOR INVESTMENT
IN LG&E ENERGY CORP.
This exhibit describes and explains the purpose of the corporate structure
that PowerGen plc ("PowerGen") intends to use for its acquisition of all of the
issued and outstanding shares of LG&E Energy Corp. ("LG&E Energy"). The
structure described below is the proposed structure of the PowerGen system as it
relates to LG&E Energy immediately after the acquisition of LG&E Energy is
completed, which is the point when PowerGen will register as a holding company
under the Public Utility Holding Company Act of 1935, as amended. The following
points should be noted in connection with the structure:
1. The purpose of this structure is to permit both reinvestment and
repatriation of the profits of LG&E Energy in a tax efficient manner. The
intermediate companies between PowerGen and PowerGen US Investments Corp. are
formed solely for the purposes of this transaction and are directly or
indirectly wholly owned by PowerGen. The parties note that this structure
provides insulation to the U.S. jurisdictional operations by separating them
from the remainder of the group under a holding company (PowerGen US Investments
Corp.) incorporated in the United States.
2. The diagram set forth below is the current intended structure based on our
best understanding of the relevant tax treatment to be afforded the companies
and their interaction with management imperatives. However, it is possible that
as a result of future changes in tax or accounting rules or other related
matters, the structure will need to change to some extent prior to closing. Any
changes in the structure prior to the closing of the transaction will be
reflected in an amendment to the Application/Declaration on Form U-1.
1
<PAGE>
The diagram below assumes that the purchase price for LG&E Energy is $3.23
billion.
------------------
Powergen plc
------------------
|
------------------ -----------------
External Debt
$3.23bn Powergen US Holdings Powergen Capital
--------------- Limited Co
-------------------- -----------------
| Loan $3.23bn
----------------- ------------------
Powergen US Ergon US
Investments Ltd Investments Ltd
----------------- ------------------
|
------------------------ --------------------
Powergen Luxembourg SARL Powergen Luxembourg
------------------------ Securities SARL
| --------------------
------------------------
Powergen Luxembourg
Holdings SARL
---------------------
| |
| |
-------------------- |
Powergen Luxembourg | 10%
Investments SARL |
-------------------- |
90% | |
| |
------------------
Powergen US
Partnership
------------------
|
------------------
Powergen US
Investments Corp.
------------------
|
------------------
LG&E Energy Corp.
and Subsidiaries
------------------
2
