CEOs: sale of Westar will mean good things for customers

The pending acquisition of Westar by Kansas City Power & Light will be just fine for everybody, the CEOs of the two utilities told an audience Monday night.

Mark Ruelle, CEO of Westar, and Terry Bassham, CEO of KCP&L, were at Abode Venue Monday in Wichita as part of an explanation tour, visiting cities and towns around the areas covered by the two companies. In the audience were local business and government leaders.

Great Plains Energy, the holding company for KCP&L, will actually be the company acquiring Westar.

The two companies have received a number of regulatory approvals, including an compromise with the Missouri Public Service Commission. The Kansas Corporation Commission must rule on the deal by April.

The companies expect to receive those approvals and merge by the second quarter.

There are a lot of questions from customers, Ruelle and Bassham said: what about rates? what about jobs? what’s the name? will the merged company offer more help for energy conservation?

The two tried to reassure people that the merger will mean relatively little to customers, while the cost will be absorbed by increased efficiency within the combined company. The company will be more efficient and cost effective, they said, and after a few years will see savings of $200 million a year.

Nothing Westar could do independently could reach those kinds of savings, said Ruelle.

“How can we get better, more affordable, without raising prices?” Ruelle said. “One way we can do that is by combining our company with our next door neighbor, Great Plains Energy.”

Much of the cost savings will come from lower labor costs, but Bassham said that doesn’t mean layoffs.

The companies see 4-5 percent of their workers leave every year, Bassham said. If the consolidation is properly managed, there won’t be any layoffs. Great Plains has even agreed to keep the Westar headquarters in Topeka open as the Kansas headquarters.

“Let’s be honest, we’re trying to drive down and hold down rates for our customers,” Bassham said. “That’s our job here. But we also want to take care of jobs, the people and the families of those who work for us today.”

What will it mean for Wichita? Not much, Bassham said. Commitment to the community will continue. Rates are likely to remain stable going forward because of the lower costs.

Wichita Mayor Jeff Longwell asked Bassham if he had considered moving the combined company headquarters to Wichita.

Bassham didn’t answer directly, but said that Wichita will keep the Westar call center and other service functions, and it could even grow. The biggest hits, he said, will come to administrative jobs, rather than customer service or repair jobs.

Westar is in the midst of moving its main service center from central Wichita to a $20 million facility on Webb Road, and that will continue.

The new company hasn’t committed to a name, yet, but it has to make sense across a territory that reaches from central Missouri to central Kansas.

“We could be Great Plains Energy, but probably the best name is not rolling into Wichita with Kansas City Power & Light,” Bassham said.

This story was originally published November 15, 2016 at 11:44 AM with the headline "CEOs: sale of Westar will mean good things for customers."