Great Plains Energy to buy Westar for $8.6 bln
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Great Plains Energy , the parent of regulated power utility Kansas City Power & Light, will buy rival Westar Energy for $8.6 billion, the biggest deal in the U.S. power distribution market so far this year.

Shares of Great Plains fell nearly 6 percent Tuesday, while Westar's stock gained more than 6 percent. Falling demand for electricity in both open and regulated markets due to increased energy efficiency and a weak economy has led to several deals as U.S. utilities look to cut costs and diversify their portfolios. This year, Dominion Resources said it would buy Questar for about $4.4 billion and Exelon closed its $6.8 billion merger with Pepco Holdings.

The deal, which has an enterprise value of about $12.2 billion including $3.6 billion of Westar's debt, will increase Great Plains' customer base to more than 1.5 million in Kansas and Missouri and its generation capacity to nearly 13,000 megawatts. Great Plains had a generation capacity of about 6,400 megawatts and about 850,800 customers in the two states, as of March 31. The industry is facing increased customer expectations, stricter environmental standards and emerging cyber security threats, Great Plains Chairman and Chief Executive Terry Bassham said. "These factors, coupled with slower demand growth for electricity, are driving our costs and customer rates higher."