Filed Pursuant to Rule 424(b)(5)
Registration No. 333-70964
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED OCTOBER 16, 2001)
8,500,000 SHARES
[ALLIANT ENERGY CORPORATION LOGO]
ALLIANT ENERGY CORPORATION
COMMON STOCK
----------------------
We are a growing diversified energy-services provider engaged primarily in
regulated utility operations in both the Midwest and internationally. We also
have significant non-regulated domestic and international operations. We are
selling 8,500,000 shares of common stock with this prospectus supplement.
Our common stock is listed on the New York Stock Exchange under the symbol
"LNT." On November 8, 2001, the last reported sale price of our common stock on
the New York Stock Exchange was $28.35 per share.
INVESTING IN THE COMMON STOCK INVOLVES RISKS THAT ARE DESCRIBED IN THE
"RISK FACTORS" SECTION BEGINNING ON PAGE S-4 OF THIS PROSPECTUS SUPPLEMENT.
----------------------
PER SHARE TOTAL
--------- -----
Public offering price................................... $28.00 $238,000,000
Underwriting discount................................... $1.05 $8,925,000
Proceeds, before expenses, to Alliant Energy
Corporation........................................... $26.95 $229,075,000
The underwriters may also purchase up to an additional 1,275,000 shares
from us at the public offering price, less the underwriting discount, within 30
days from the date of this prospectus supplement to cover overallotments.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus supplement or the accompanying prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
The shares will be ready for delivery on or about November 15, 2001.
----------------------
MERRILL LYNCH & CO. MORGAN STANLEY
ROBERT W. BAIRD & CO.
BANC OF AMERICA SECURITIES LLC
LEGG MASON WOOD WALKER
INCORPORATED
SALOMON SMITH BARNEY
----------------------
The date of this prospectus supplement is November 8, 2001.
[MAP]
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
----
Summary..................................................... S-2
Risk Factors................................................ S-4
Forward-Looking Statements.................................. S-6
Recent Developments......................................... S-7
The Company................................................. S-8
Use of Proceeds............................................. S-22
Capitalization.............................................. S-23
Selected Financial Information.............................. S-24
Underwriting................................................ S-25
PROSPECTUS
About This Prospectus....................................... 2
Alliant Energy Corporation.................................. 3
Use of Proceeds............................................. 3
Price Range of Common Stock and Dividend Policy............. 4
Description of Common Stock................................. 5
Plan of Distribution........................................ 7
Where You Can Find More Information......................... 7
Legal Matters............................................... 8
Experts..................................................... 8
----------------------
You should rely only on the information contained or incorporated by
reference in this prospectus supplement and the accompanying prospectus. We have
not, and the underwriters have not, authorized any other person to provide you
with different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not, and the
underwriters are not, making an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. You should assume that
the information appearing in this prospectus supplement, the accompanying
prospectus and the documents incorporated by reference is accurate only as of
the respective dates of those documents in which the information is contained.
Our business, financial condition, results of operations and prospects may have
changed since those dates.
----------------------
Unless we otherwise indicate or unless the context requires otherwise, all
references in this prospectus supplement to "we," "our," "us" or similar
references mean Alliant Energy Corporation.
i
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SUMMARY
This summary highlights information contained elsewhere in this prospectus
supplement and the accompany prospectus. This summary may not contain all of the
information that may be important to you. You should read carefully all of the
information contained in or incorporated by reference into this prospectus
supplement and the accompanying prospectus before making a decision to invest in
our common stock.
OUR COMPANY
We are a growing diversified energy-services provider engaged primarily in
regulated utility operations in both the Midwest and internationally. We also
have significant non-regulated domestic and international operations. We were
formed in April 1998 as a result of the merger of WPL Holdings, Inc., IES
Industries Inc. and Interstate Power Company. Through our subsidiaries and
partners, we provide electric, natural gas, water and steam services to our over
3 million customers worldwide. Our domestic utilities operate in Iowa,
Wisconsin, Illinois and Minnesota. Alliant Energy Resources, Inc., our
wholly-owned non-regulated subsidiary, has energy-related operations and
investments throughout the United States as well as in Australia, Brazil, China
and New Zealand.
For the year ended December 31, 2000, our operating revenues were $2.4
billion and at December 31, 2000, we had $6.7 billion in assets. The following
is a summary for the last three years of our adjusted net income and adjusted
earnings per diluted share.
(Graph)
ADJUSTED NET INCOME(1) IN MILLIONS
----------------------------------
1998 $ 131.3
1999 $ 171.3
2000 $ 179.0
(Graph)
ADJUSTED EARNINGS PER DILUTED SHARE(1)
--------------------------------------
1998 $ 1.71
1999 $ 2.19
2000 $ 2.26
---------------
(1) Adjusted net income for 1998 excludes $34.6 million, or $0.45 per share, of
merger-related charges. Reported net income for 1998 was $96.7 million and
reported earnings per diluted share were $1.26. Adjusted net income for 1999
excludes $25.3 million, or $0.32 per share, of income from gains on sales of
McLeodUSA Incorporated stock. Reported net income for 1999 was $196.6
million and reported earnings per diluted share were $2.51. Adjusted net
income for 2000 excludes $204.0 million, or $2.58 per share, of non-cash
income related to our adoption of Statement of Financial Accounting
Standards No. 133 on July 1, 2000, and $15.7 million, or $0.20 per share, of
income from gains on sales of McLeodUSA stock. Reported net income for 2000
was $398.7 million and reported earnings per diluted share were $5.03.
DOMESTIC UTILITY OPERATIONS
Our domestic utility operations consist of our regulated public utility
subsidiaries, IES Utilities Inc., Wisconsin Power and Light Company and
Interstate Power Company. Our domestic utility subsidiaries are engaged
principally in the generation, transmission, distribution and sale of electric
energy to approximately 930,000 customers; the purchase, distribution,
transportation and sale of natural gas to approximately 398,000 customers; and
the delivery of steam and water services in selected markets. Our domestic
utility subsidiaries have service territories in more than 1,000 communities in
Iowa, southern and central Wisconsin, northwestern Illinois and southern
Minnesota.
ALLIANT ENERGY RESOURCES
Through our subsidiary, Alliant Energy Resources, we manage a portfolio of
companies involved in international utility operations and non-regulated
domestic and international businesses. Alliant Energy Resources' divisions
include International, Non-Regulated Generation, Investments, Trading and
Integrated Services.
S-2
THE OFFERING
Issuer........................ Alliant Energy Corporation
222 West Washington Avenue
Madison, Wisconsin 53703
Telephone: 608-252-3311
Common stock offered.......... 8,500,000 shares
Approximate number of shares
of common stock outstanding
after the offering............ 87,550,000 shares
Common stock price range:
January 1, 2001 through
November 8, 2001.............. $27.90 -- $33.20
Listing....................... New York Stock Exchange
Symbol........................ LNT
Indicated annual dividend
rate.......................... $2.00 per share, paid quarterly
Book value per share at
June 30, 2001................. $21.60
Use of proceeds............... We estimate that our net proceeds from this
offering without exercise of the overallotment
option will be approximately $228,650,000. We
will use the net proceeds from this offering to
repay our short-term debt, as well as
short-term debt of our subsidiaries, including
some commercial paper currently classified as
long-term debt. The debt to be repaid was
incurred to finance the development and
construction of new utility generation,
transmission and distribution facilities, fund
additional working capital, finance capital
expenditures and fund acquisitions and
investments and for other general corporate
purposes.
Risk Factors.................. See "Risk Factors" and other information
included or incorporated by reference in this
prospectus supplement and the accompanying
prospectus for a discussion of factors you
should carefully consider before deciding to
invest in shares of our common stock.
The number of shares outstanding after the offering is based on our shares
outstanding as of June 30, 2001. The number of shares outstanding after the
offering assumes that the underwriters' overallotment option is not exercised.
If the underwriters exercise their overallotment option in full, we will issue
and sell an additional 1,275,000 shares and will receive additional proceeds
before expenses of $34,361,250. See "Underwriting."
S-3
RISK FACTORS
You should carefully consider the risk factors described below, as well as
the other information included or incorporated by reference in this prospectus
supplement and the accompanying prospectus, before making an investment in our
common stock. The risks and uncertainties described below are not the only ones
facing our company.
THE ENERGY INDUSTRY IS RAPIDLY CHANGING AND BECOMING INCREASINGLY COMPETITIVE,
WHICH MAY ADVERSELY AFFECT OUR ABILITY TO OPERATE PROFITABLY.
The energy industry is in a period of fundamental change resulting from
legislative and regulatory changes. Although we expect that deregulation in our
domestic retail service territories will likely be delayed due to events related
to California's restructured electric utility industry, regulatory changes and
other developments will continue to increase competitive pressures on electric
and gas utility companies. Generally, increased competition could threaten our
market share in some segments of our business and could reduce our profit
margins. Such competitive pressures could cause us to lose customers and incur
additional costs that would be borne by shareowners if these costs cannot be
recovered from customers.
IF WE ARE UNABLE TO RECOVER THE COST OF FUEL, PURCHASED POWER AND NATURAL GAS
COSTS FROM OUR CUSTOMERS, THEN WE MAY EXPERIENCE AN ADVERSE IMPACT ON OUR
BUSINESS.
Approximately 54% of our domestic utility operating revenues are from our
Iowa operations and approximately 40% of our domestic utility operating revenues
are from our Wisconsin operations. Our Iowa utilities are entitled to recover
increases in the cost of fuel, purchased energy and natural gas purchased for
resale automatically through electric and natural gas rates. Purchased power
capacity costs in Iowa are not recovered from electric customers through these
energy adjustment clauses. Recovery of these costs must be addressed in a formal
rate proceeding. Retail electric rates of our Wisconsin utility are based in
part on forecasted fuel and purchased power costs. We can seek emergency rate
increases in Wisconsin if these costs on an annual basis are more than 3% higher
than the estimated costs used to establish rates. If we are unable to recover
our costs through adjusted rates, then we may experience an adverse impact on
our results of operations and cash flows.
AS A HOLDING COMPANY, WE ARE SUBJECT TO RESTRICTIONS ON OUR ABILITY TO PAY
DIVIDENDS.
As a holding company with no significant operations of our own, the primary
source of funds for the payment of dividends to our shareowners is dividends our
subsidiaries pay to us. Our subsidiaries are separate and distinct legal
entities and have no obligation to pay any amounts to us, whether by dividends,
loans or other payments. The ability of our subsidiaries to pay dividends or
make distributions to us, and accordingly, our ability to pay dividends on our
common stock, will depend on the earnings, capital requirements and general
financial condition of our subsidiaries. Our domestic utility subsidiaries each
have dividend payment restrictions based on their respective bond indentures,
the terms of their outstanding preferred stock and state regulatory limitations
applicable to them. If we do not receive adequate distributions from our
subsidiaries, then we may not be able to make or may have to reduce dividend
payments on our common stock.
OUR COSTS OF COMPLIANCE WITH ENVIRONMENTAL LAWS ARE SIGNIFICANT AND THE COSTS OF
COMPLIANCE WITH NEW ENVIRONMENTAL LAWS AND THE INCURRENCE OF ENVIRONMENTAL
LIABILITIES COULD ADVERSELY AFFECT OUR PROFITABILITY.
Our operations are subject to extensive regulation relating to
environmental protection. To comply with these legal requirements, we must spend
significant sums on environmental monitoring, pollution control equipment and
emission fees. New environmental laws and regulations affecting our operations
may be adopted, and new interpretations of existing laws and regulations could
be adopted or become applicable to us or our facilities, which may substantially
increase our environmental expenditures in the future. In addition, we may not
be able to recover all of our costs for environmental expenditures through
electric and natural gas rates at current levels in the future. Under current
law, we are also generally responsible
S-4
for any on-site liabilities associated with the environmental condition of our
facilities that we have previously owned or operated, regardless of whether the
liabilities arose before, during or after the time we owned or operated the
facilities. The incurrence of a material environmental liability could have a
material adverse effect on our results of operations and financial condition.
OUR ABILITY TO ACHIEVE GROWTH IN OUR NON-REGULATED BUSINESSES DEPENDS UPON THE
AVAILABILITY OF SUITABLE ACQUISITIONS AND PROJECTS FOR DEVELOPMENT AND OUR
ABILITY TO ACCESS CAPITAL AT COMPETITIVE RATES.
Our growth strategy depends upon our ability to identify and complete
acquisitions and development projects at prices that will allow us to earn a
competitive rate of return. Our non-regulated businesses have achieved growth
through acquisitions. However, we may not be able to identify appropriate future
acquisitions and projects. Our future acquisitions and projects also may not
perform as expected and the returns from those transactions may not support the
indebtedness we incur to acquire them or the capital expenditures we need to
maintain or develop them. In addition, if we are not able to access capital at
competitive rates, then our growth will be adversely affected.
WE HAVE MADE SUBSTANTIAL INTERNATIONAL INVESTMENTS, WHICH MAY PRESENT ADDITIONAL
RISKS TO OUR BUSINESS.
As of June 30, 2001, we had $604 million in net investments in foreign
countries, primarily in electric utility companies and generation facilities,
through our non-regulated subsidiary, Alliant Energy Resources, and we
anticipate making additional new international investments in the future.
International operations are subject to various risks, including political and
economic instability, local labor market conditions, the impact of foreign
government regulations and taxation, and differences in business practices.
Unfavorable changes in the international political, regulatory or business
climate could have a material adverse effect on our growth plans for our
international investments and, in turn, our results of operations and financial
condition. In addition, the results of operations and financial condition of our
subsidiaries that conduct operations in foreign countries will be reported in
the relevant foreign currencies and then translated into U.S. dollars at the
applicable exchange rates for inclusion in our consolidated financial
statements. Fluctuations between these currencies and the U.S. dollar may have a
material adverse effect on our results of operations and financial condition and
may also significantly affect the comparability of our results between financial
periods.
S-5
FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus and the information
we incorporate by reference into this prospectus supplement and the accompanying
prospectus contain forward-looking statements that are intended to qualify for
the safe harbors from liability established by the Private Securities Litigation
Reform Act of 1995. All statements other than statements of historical fact,
including statements regarding anticipated financial performance, business
strategy and management's plans and objectives for future operations, are
forward-looking statements. These forward-looking statements can be identified
as such because the statements generally include words such as "expect,"
"intend," "believe," "anticipate," "estimate," "plan" or "objective" or other
similar expressions. These forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ materially from those
expressed in, or implied by, these statements. Some, but not all, of the risks
and uncertainties include those described in the "Risk Factors" section of this
prospectus supplement and the following:
- effects of weather on sales and revenues;
- general economic conditions in our utility subsidiaries' service
territories;
- unanticipated construction and acquisition expenditures;
- issues related to costs we have incurred or may incur but that we cannot
recover through increased rates;
- unanticipated issues related to the supply and price of purchased
electricity;
- adverse fluctuations in the price of oil and natural gas;
- unexpected issues related to the operations of our nuclear facilities;
- technological developments;
- employee workforce factors, including changes in key executives,
collective bargaining agreements or work stoppages; and
- changes in the rate of inflation.
S-6
RECENT DEVELOPMENTS
THIRD QUARTER RESULTS
On October 19, 2001, we announced adjusted net income of $74.9 million, or
$0.94 per share, for the third quarter of 2001 compared to adjusted net income
of $73.5 million, or $0.93 per share, for the third quarter of 2000. Adjusted
net income for the third quarter of 2001 excludes $12.6 million, or $0.16 per
share, of non-cash valuation charges related to our exchangeable senior notes.
Adjusted net income for the third quarter of 2000 excludes $1.2 million, or
$0.02 per share, of non-cash valuation charges related to our exchangeable
senior notes and $204.0 million, or $2.58 per share, of non-cash income related
to our adoption of Statement of Financial Accounting Standards No. 133 on July
1, 2000. Reported net income and earnings per diluted share were $62.3 million
and $0.78 for the third quarter of 2001 and $276.2 million and $3.49 for the
third quarter of 2000.
DECLARATION OF DIVIDEND
On October 17, 2001, we announced that our Board of Directors declared a
dividend on our common stock of $0.50 per share. The dividend is payable on
November 15, 2001 to shareowners of record on October 31, 2001.
DEVELOPMENT OF NON-REGULATED GENERATION FACILITY
On October 4, 2001, we announced an agreement with Panda Energy
International, Inc. to jointly develop and operate a 1,100-megawatt natural gas
combined-cycle power plant in western Michigan. We expect that construction of
the facility will begin during the first quarter of 2002 and that the facility
will become operational in 2004, in each case assuming some conditions are
satisfied. We estimate that the total cost of the project will be approximately
$600 million. We anticipate that at least 55% of the project costs will be
financed through non-recourse debt at the joint venture level, with the
remaining portion to be provided by us.
CREATION OF TRANSLINK
On September 28, 2001, six electric utility companies, including our
subsidiaries IES Utilities Inc. and Interstate Power Company, announced the
filing of an application with the Federal Energy Regulatory Commission to create
TRANSLink Transmission Co. LLC, a for-profit transmission-only company. The
participants have requested that the Federal Energy Regulatory Commission
expedite consideration of the application so that TRANSLink could commence
operations by 2002. Current plans call for IES Utilities Inc. and Interstate
Power Company to contribute their transmission assets, which have an estimated
book value of $300 million, to TRANSLink in exchange for a corresponding
ownership interest in TRANSLink. The TRANSLink proposal is subject to receipt of
all required federal and state regulatory approvals.
NEW INVESTMENTS IN CHINA
On August 31, 2001, we announced that Alliant Energy International, a
subsidiary of Alliant Energy Resources, acquired three combined heat and power
facilities in the People's Republic of China representing an investment of $66
million. These facilities were acquired through the establishment of joint
ventures by Peak Pacific Investment Company, Ltd, a development company
majority-owned by Alliant Energy International. The three acquired facilities in
China have a total generation capacity of 225 megawatts.
S-7
THE COMPANY
We are a growing diversified energy-services provider engaged primarily in
regulated utility operations in both the Midwest and internationally. We also
have significant non-regulated domestic and international operations. We were
formed in April 1998 as a result of the merger of WPL Holdings, Inc., IES
Industries Inc. and Interstate Power Company. Through our subsidiaries and
partners, we provide electric, natural gas, water and steam services to our over
3 million customers worldwide. Our domestic utilities operate in Iowa,
Wisconsin, Illinois and Minnesota. Alliant Energy Resources, Inc., our
wholly-owned non-regulated subsidiary, has energy-related operations and
investments throughout the United States as well as in Australia, Brazil, China
and New Zealand.
[Graph-Breakdown of Alliant Energy Corporation $179.0 million Adjusted Net
Income for 2000(1)(2)]
---------------
(1) Includes $5.9 million of holding company and other expenses.
(2) Adjusted net income for 2000 excludes $204.0 million of non-cash income
related to our adoption of Statement of Financial Accounting Standards No.
133 on July 1, 2000, and $15.7 million of income from gains on sales of
McLeodUSA stock. Substantially all of these adjustments were at the Alliant
Energy Resources level. Reported net income for 2000 was $398.7 million.
DOMESTIC UTILITY OPERATIONS
Our domestic utility operations consist of our regulated public utility
subsidiaries, IES Utilities Inc., Wisconsin Power and Light Company and
Interstate Power Company.
- IES Utilities Inc., incorporated in 1925, is an Iowa utility engaged
principally in the generation, transmission, distribution and sale of
electric energy to approximately 347,000 customers; the purchase,
distribution, transportation and sale of natural gas to approximately
182,000 customers; and the delivery of steam services in selected
markets.
- Wisconsin Power and Light Company, incorporated in 1917, is a Wisconsin
utility engaged principally in the generation, transmission, distribution
and sale of electric energy to approximately 414,000 customers; the
purchase, distribution, transportation and sale of natural gas to
S-8
approximately 165,000 customers; and the delivery of water services in
selected markets to approximately 19,000 customers.
- Interstate Power Company, incorporated in 1925, is a public utility
operating in Iowa, Illinois and Minnesota engaged principally in the
generation, transmission, distribution and sale of electric energy to
approximately 168,000 customers and the purchase, distribution,
transportation and sale of natural gas to approximately 50,000 customers.
On April 23, 2001, shareowners of IES Utilities Inc. and Interstate Power
Company approved the merger of Interstate Power Company with and into IES
Utilities Inc. We expect the merger to be completed on January 1, 2002.
ALLIANT ENERGY RESOURCES
Through our subsidiary, Alliant Energy Resources, we manage a portfolio of
companies involved in international utility operations and non-regulated
domestic and international businesses:
- International: We have established global partnerships to develop energy
generation, delivery and infrastructure in growing international markets,
including Australia, Brazil, China and New Zealand. We have strategic
investments in hydro generation assets in Australia, distribution and
generation assets in Brazil, combined heat and power plants in China and
hydro and wind generation assets in New Zealand. Our global partners
include Companhia Forca e Luz Cataguazes-Leopoldina and TrustPower
Limited.
- Non-Regulated Generation: Consistent with our strategy to accumulate and
develop a portfolio of domestic non-regulated generation assets, we
recently announced a partnership with Panda Energy International to
jointly develop and operate a 1,100-megawatt natural gas combined-cycle
power plant in western Michigan. We expect that construction of the
facility will begin during the first quarter of 2002 and that the
facility will become operational in 2004, in each case assuming some
conditions are satisfied.
- Investments: Our existing investments include our wholly-owned oil and
gas production company, Whiting Petroleum Corporation; our short-line
railroad, Cedar Rapids and Iowa City Railway Company; our investment in a
barge company, IEI Barge Services Inc.; our investments in affordable
housing through Heartland Properties, Inc.; various real estate joint
ventures; and our equity stake in an independent telecommunications
provider, McLeodUSA.
- Trading: We have an energy-trading joint venture with Cargill
Incorporated, one of the world's largest and most established commodities
trading firms, that combines Cargill's risk-management and commodity
trading expertise with our low-cost electricity generation and
transmission business experience.
- Integrated Services: The integrated services division includes Cogenex
Corporation, a provider of energy management consulting, on-site
generation and energy infrastructure; Alliant Energy Integrated
Services-Energy Management LLC, an energy procurement company; and RMT,
Inc., a provider of environmental engineering and construction management
services. These companies provide services to commercial, industrial,
institutional, educational and governmental customers.
S-9
OUR STRATEGY
Our mission is to create energy partnerships and solutions that exceed our
customers' expectations for comfort, security and productivity in our service
territories and around the world. We plan to achieve this goal by executing our
"invest, connect and grow" strategy. We plan to invest in our core domestic
regulated utility operations and infrastructure, as well as in domestic and
international regulated and non-regulated generation and other energy-related
opportunities. We will continue to use technology and other resources to better
connect with our customers through enhanced service reliability and operational
efficiencies, value-added products and services, and e-business initiatives. We
will continue to grow our non-regulated operations through partnerships and
acquisitions with a focus on generation projects, select international markets
and other strategic initiatives. Our goal is to have our non-regulated
operations contribute more than 25% to our adjusted earnings within the next
three years. We believe that successful implementation of these strategies will
contribute significantly to the achievement of our targeted annual growth rate
of 7% to 10% in adjusted earnings.
INVESTING IN OUR CORE REGULATED UTILITY, GENERATION AND OTHER ENERGY-RELATED
OPPORTUNITIES
- We continue to invest in our core regulated domestic utility operations
and infrastructure. We plan to invest an additional $1.7 billion through
our PowerPledge program over the next four years to increase the service
reliability and operating efficiencies of our existing regulated utility
system and to support the anticipated growth in our domestic service
territories.
- We also plan to invest in a portfolio of domestic non-regulated
generation assets through acquisition, development and expansion, both
inside and outside of our service territory. Consistent with this
strategy, we recently announced a partnership with Panda Energy
International to jointly develop and operate a 1,100-megawatt natural gas
combined-cycle power plant in western Michigan. We expect that
construction of the facility will begin during the first quarter of 2002
and that the facility will become operational in 2004, in each case
assuming some conditions are satisfied.
- Including non-regulated generation projects, we plan to invest $2.0
billion over the next four years in various energy-related businesses
that we believe offer potential for future growth while enhancing
shareowner value. We expect these investments to include expanding our
international generation and distribution assets in Australia, Brazil,
China and New Zealand. We also plan to invest in our other domestic
non-regulated businesses, including our oil and gas production operations
and our integrated energy services business.
CONNECTING WITH OUR CUSTOMERS
- We believe that increasing our "connection" to our existing 3 million
customers and our future customers is the key to ensuring our competitive
edge in the long-term. Although the majority of our regulated utility
customers are not yet able to choose their energy supplier, we are
working to help them better manage and understand their energy options.
We strive to provide exceptional service to our customers and, by doing
this, we expect to increase our customers' satisfaction and earn their
continued loyalty.
- We plan to maintain and enhance our reputation with our customers by
making additional investments in our distribution networks and support
systems. We believe these additional investments will allow us to enhance
service reliability, operational excellence and customer satisfaction.
- We believe that increased utilization of the Internet can enhance the
connection with our customers, suppliers and investors, increase our
revenues and help us realize cost savings through increased efficiency.
In the last two years, we have implemented several e-business initiatives
that allow customers to access information more efficiently and
communicate with us through our
S-10
improved web site, which permits customers to review and pay bills online
and allows us to reduce our overhead expenses in several areas.
GROWING ALLIANT ENERGY OPERATIONS
Our goal is to have our non-regulated operations account for more than 25%
of our adjusted earnings within the next three years as a result of our
additional investments and the improved profitability of our existing
non-regulated businesses. Furthermore, we believe that our continued investment
in our core domestic regulated utilities and our domestic and international
non-regulated businesses, as well as our commitment to connect with our over 3
million customers, will result in enhanced shareowner value and our ability to
achieve our targeted annual growth rate of 7% to 10% in adjusted earnings.
OUR COMPETITIVE STRENGTHS
We believe we have substantial competitive strengths that will enable us to
execute our strategy successfully. We believe our competitive strengths are
reflected in our earnings and growth track record and include:
DOMESTIC UTILITY OPERATIONS
- Stable upper-Midwest utility service territory creating strong cash flows
from operations.
- Competitive electric rates in both our region and nationally.
- Significant management experience in regulated domestic utility
operations.
- Service territories located in favorable regulatory environments.
ALLIANT ENERGY RESOURCES
- Proven track record of quickly and successfully integrating both domestic
and international businesses obtained through mergers and acquisitions.
- Valuable knowledge and experience gained in privatized and deregulating
utility markets through our investments in Australia, Brazil, China and
New Zealand.
- Joint venture with Cargill Incorporated gives us the commodity trading
expertise of one of the largest commodities traders in the world.
- Established ability to seek out and develop alliances with strong
partners when entering new markets.
S-11
BUSINESS SEGMENT REVIEW
Our business is organized in two segments consisting of our core regulated
domestic utility operations and our non-regulated and international operations
grouped under Alliant Energy Resources. The following charts show the percentage
of our total assets of each of these groups at December 31, 2000 and the
adjusted net income that each of these groups contributed for the year ended
December 31, 2000.
(Graph-Assets by Business Segment $6.7 billion)
NON-REGULATED AND INTERNATIONAL REGULATED DOMESTIC UTILITIES
------------------------------- ----------------------------
35% 65%
(Graph-Adjusted Net Income by Business Segment $179.0 million(1)(2))
NON-REGULATED AND INTERNATIONAL REGULATED DOMESTIC UTILITIES
------------------------------- ----------------------------
$ 17.1 million $ 167.8 million
---------------
(1) Includes $5.9 million of holding company and other expenses.
(2) Adjusted net income for 2000 excludes $204.0 million of non-cash income
related to our adoption of Statement of Financial Accounting Standards No.
133 on July 1, 2000, and $15.7 million of income from gains on sales of
McLeodUSA stock. Substantially all of these adjustments were at the Alliant
Energy Resources level. Reported net income for 2000 was $398.7 million.
DOMESTIC UTILITY OPERATIONS
Our domestic utility operations consist of regulated electric, natural gas
and steam and water service businesses. We serve more than 1.3 million customers
in more than 1,000 communities in Iowa, southern and central Wisconsin,
northwestern Illinois and southern Minnesota. Approximately 54% of our domestic
utility operating revenues are from our Iowa operations and approximately 40% of
our domestic utility operating revenues are from our Wisconsin operations. We
believe sales of electric and gas commodities to end user customers will
continue to grow across our domestic service territories as the consumption of
electricity and gas by residential and business customers expands. For the year
ended December 31, 2000, our domestic utility operations represented $167.8
million of our adjusted net income. The composition of our domestic utility
revenues for the year ended December 31, 2000 was as follows:
(Graph-Total Revenues $2.1 billion(1))
GAS STEAM AND WATER ELECTRIC
--- --------------- --------
20% 1% 79%
(Graph-Electric Revenues $1.6 billion)
COMMERCIAL OTHER INDUSTRIAL RESIDENTIAL
---------- ----- ---------- -----------
21% 15% 30% 34%
(Graph-Gas Revenues $0.4 billion)
COMMERCIAL OTHER INDUSTRIAL RESIDENTIAL
---------- ----- ---------- -----------
31% 3% 7% 59%
---------------
(1) Includes $33.4 million of steam and water revenues.
Historically, we have managed our power supply requirements through a
combination of owned capacity and purchased power contracts. In 2000,
approximately 75% of our domestic megawatt-hour sales were provided by
generation facilities we own. Our current regulated domestic generation capacity
is approximately 5,900 megawatts, consisting of 5,200 megawatts from
company-owned generation facilities and 700 megawatts from purchased power
contracts. In addition, we have entered into an agreement with Calpine
Corporation to purchase capacity and energy from a 453-megawatt gas-fired power
plant to be constructed near Beloit, Wisconsin. We expect the plant to be in
service by early 2004.
S-12
We believe that our capacity, including the Calpine plant, will allow us to
meet our expected load requirements. Furthermore, we have transmission
interconnections at various locations with 12 other transmission-owning
utilities in the Midwest. We believe these interconnections enhance the overall
reliability of our transmission systems and provide access to multiple sources
of economic and emergency power and energy. We manage our supply portfolio to
maintain an 18% reserve margin and we believe that our proximity to transmission
and generating capacity in the upper Midwest region provides us additional
access to a low-cost supply of power. Our sources of power supply for the year
ended December 31, 2000 were as follows:
(Graph-Sources of Supply in 2000 (32,299 Thousand Megawatt-Hours))
NUCLEAR OTHER PURCHASED POWER COAL AND GAS
------- ----- --------------- ------------
15% 1% 25% 59%
DOMESTIC UTILITY STRATEGY
Our strategic objectives within our regulated domestic segment are:
- To increase our megawatts of capacity through investment in new electric
power generation, subject to appropriate regulatory incentives;
- To increase plant availability and reduce the cost of energy production;
- To enhance service reliability and operational excellence;
- To provide excellent customer service;
- To maintain favorable regulatory relationships;
- To remain current with cutting-edge technologies that impact our
business; and
- To practice proactive environmental compliance.
IES UTILITIES INC.
IES Utilities Inc., or IESU, is a regulated utility serving customers in
Iowa. IESU is engaged principally in the generation, transmission, distribution
and sale of electric energy to approximately 347,000 customers in 525
communities; the purchase, distribution, transportation and sale of natural gas
to approximately 182,000 customers in 212 communities; and the delivery of steam
services in selected markets.
S-13
During 2000, IESU had total revenues of $876.0 million, which included
$28.4 million of steam and other revenues. IESU's electric and gas revenues
consisted of the following:
ELECTRIC GAS
----------------------------------------- ---------------------------------------
REVENUES SALES CUSTOMERS REVENUES SALES CUSTOMERS
----------- --------------- --------- ----------- ------------- ---------
(THOUSANDS OF (THOUSANDS OF
(THOUSANDS) MEGAWATT-HOURS) (THOUSANDS) DEKATHERMS)
Residential.......... $236,084 2,742 295,747 $117,132 14,829 160,357
Commercial........... 182,068 2,701 50,498 57,671 8,753 21,751
Industrial........... 188,734 5,053 706 15,377 3,063 365
Other................ 44,573 1,084 448 6,001 10,061 --
-------- ------ ------- -------- ------ -------
Total................ $651,459 11,580 347,399 $196,181 36,706 182,473
======== ====== ======= ======== ====== =======
During the last three years, IESU's electric sales to end user customers
grew at an annualized rate of 2% and the number of electric customers increased
by 1%. During the same period, gas sales to end user customers grew at an
annualized rate of 2% and the number of gas customers increased by 1%. During
the last three years, no single customer accounted for more than 10% of IESU's
consolidated revenues.
Electric Operations. At the time of peak load in 2000, IESU had available
capacity to provide 2,143 megawatts of electricity, of which 1,916 megawatts
were installed and 227 megawatts were purchased capacity under contract. In
2000, IESU had a maximum peak hour demand of 2,067 megawatts in the month of
August. During 2000, sources of generation at IESU included 55% coal/gas, 26%
nuclear, 18% purchased and 1% other.
IESU owns and operates 4,448 miles of electric transmission lines and 577
substation facilities connecting with its high voltage transmission systems. A
non-cancelable operating agreement, which will terminate on December 31, 2035,
provides for the joint use of certain transmission facilities of IESU and
Central Iowa Power Cooperative.
Gas Operations. At December 2000, IESU served approximately 182,000
customers in approximately 212 communities. The gas utility operations accounted
for 22% of IESU operating revenues for the year ended December 31, 2000.
Steam Operations. Steam operations, based entirely in Cedar Rapids, Iowa,
represented about 3% of IESU's revenues for the year ended December 31, 2000.
Construction Program. Construction expenditures for 2000 were $121
million. Estimated construction expenditures are approximately $147 million for
2001, and $786 million for 2002 through 2005.
WISCONSIN POWER AND LIGHT COMPANY
Wisconsin Power and Light Company, or WP&L, is a regulated utility with a
service territory of 16,000 square miles in southern and central Wisconsin and
northern Illinois. WP&L is engaged principally in the generation, transmission,
distribution and sale of electric energy to approximately 414,000 customers in
600 communities; the purchase, distribution, transportation and sale of natural
gas to approximately 165,000 customers in 233 communities; and the delivery of
water services to approximately 19,000 customers in selected markets.
S-14
During 2000, WP&L had total revenues of $862.4 million, which included $5.0
million of water and other revenues. WP&L's electric and gas revenues consisted
of the following:
ELECTRIC GAS
----------------------------------------- ---------------------------------------
REVENUES SALES CUSTOMERS REVENUES SALES CUSTOMERS
----------- --------------- --------- ----------- ------------- ---------
(THOUSANDS OF (THOUSANDS OF
(THOUSANDS) MEGAWATT-HOURS) (THOUSANDS) DEKATHERMS)
Residential.......... $229,668 3,151 362,178 $ 96,204 12,769 146,690
Commercial........... 127,199 2,031 49,350 54,512 8,595 17,583
Industrial........... 190,085 4,688 974 8,581 1,476 513
Other................ 145,239(1) 3,291 1,923 5,855 13,680 --
-------- ------ ------- -------- ------ -------
Total................ $692,191 13,161 414,425 $165,152 36,520 164,786
======== ====== ======= ======== ====== =======
---------------
(1) Includes revenues of $115,715 for wholesale electric customers.
During the last three years, WP&L's electric sales to end user customers
grew at an annualized rate of 2% and the number of electric customers increased
by 2%. During the same period, gas sales to end user customers grew at an
annualized rate of 5% and the number of gas customers increased by 2%. During
the last three years, no single customer accounted for more than 10% of WP&L's
consolidated revenues.
Electric Operations. At the time of peak load in 2000, WP&L had available
capacity to provide 2,680 megawatts of electricity, of which 2,345 megawatts
were installed and 335 megawatts were purchased capacity under contract. In
2000, WP&L had a maximum peak hour demand of 2,508 megawatts in the month of
August. During 2000, sources of generation at WP&L included 58% coal/gas, 29%
purchased, 11% nuclear (including a planned refueling outage during 2000) and 2%
other.
Gas Operations. At December 2000, WP&L served approximately 165,000
customers in approximately 233 communities. The gas utility operations accounted
for 19% of WP&L operating revenues for the year ended December 31, 2000.
Water Operations. Water operations represented about 1% of WP&L's revenues
for the year ended December 31, 2000.
Construction Program. Construction expenditures for 2000 were $132
million. Estimated construction expenditures are approximately $138 million for
2001, and $625 million for 2002 through 2005.
INTERSTATE POWER COMPANY
Interstate Power Company, or IPC, is a regulated utility serving customers
in Iowa, Minnesota and Illinois. IPC is engaged principally in the generation,
transmission, distribution and sale of electric energy to approximately 168,000
customers in 234 communities and the purchase, distribution, transportation and
sale of natural gas to approximately 50,000 customers in 41 communities.
During 2000, IPC had total revenues of $358.0 million consisting of the
following:
ELECTRIC GAS
----------------------------------------- ---------------------------------------
REVENUES SALES CUSTOMERS REVENUES SALES CUSTOMERS
----------- --------------- --------- ----------- ------------- ---------
(THOUSANDS) (THOUSANDS OF (THOUSANDS) (THOUSANDS OF
MEGAWATT-HOURS) DEKATHERMS)
Residential.......... $101,531 1,267 141,678 $32,361 4,428 44,943
Commercial........... 39,752 633 23,985 14,921 2,348 5,320
Industrial........... 122,336 3,351 1,093 3,794 811 75
Other................ 40,767 705 945 2,539 20,190 --
-------- ----- ------- ------- ------ ------
Total................ $304,386 5,956 167,701 $53,615 27,777 50,338
======== ===== ======= ======= ====== ======
S-15
During the last three years, IPC's electric sales to end user customers
grew at an annualized rate of 1% and the number of electric customers increased
by more than 1%. During the same period, gas sales to end user customers grew at
an annualized rate of 4% and the number of gas customers increased by 1%. During
the last three years, no single customer accounted for more than 10% of IPC's
consolidated revenues.
Electric Operations. At the time of peak load in 2000, IPC had available
capacity to provide 1,117 megawatts of electricity, of which 1,029 megawatts
were installed and 88 megawatts were purchased capacity under contract. In 2000,
IPC had a maximum peak hour demand of 996 megawatts in the month of August.
During 2000, sources of generation at IPC included 71% coal/gas and 29%
purchased.
IPC owns and operates 2,600 miles of electric transmission lines and 222
substation facilities.
Gas Operations. At December 2000, IPC served approximately 50,000
customers in approximately 41 communities. The gas utility operations accounted
for 15% of IPC operating revenues during the year ended December 31, 2000.
Construction Program. Construction expenditures for 2000 were $51 million.
Estimated construction expenditures are approximately $61 million for 2001, and
$307 million for 2002 through 2005.
AMERICAN TRANSMISSION COMPANY
In 1999, Wisconsin enacted legislation for the formation of a Wisconsin
transmission-only company, American Transmission Company, LLC, for those
Wisconsin utility companies that elected to join. On January 1, 2001, WP&L
contributed its transmission assets, with approximate net book value of $186
million, in exchange for a 26% ownership in American Transmission Company. Our
partners in American Transmission Company include Madison Gas and Electric
Company, Wisconsin Energy Corporation and WPS Resources Corporation. We believe
the contribution of our WP&L transmission assets to a transmission-only company
is consistent with our strategy to connect to customers and grow our
transmission business opportunities. We expect to earn a competitive return on
our ownership interest in American Transmission Company.
TRANSLINK
In March 2001, we announced discussions with Corn Belt Power Cooperative,
MidAmerican Energy Company, Nebraska Public Power District, Omaha Public Power
District and Xcel Energy Inc. to assess the viability of developing an
independent transmission company for Midwest utilities that are not a part of
American Transmission Company. On September 28, 2001, these utility companies
and our subsidiaries, IESU and IPC, announced the filing of an application with
the Federal Energy Regulatory Commission to create TRANSLink Transmission Co.
LLC, a for-profit, transmission-only company. The participants have requested
the Federal Energy Regulatory Commission to expedite consideration of the
application so that TRANSLink could commence operations by 2002. Current plans
call for IESU and IPC to contribute their transmission assets, which have an
estimated net book value of $300 million, to TRANSLink in exchange for a
corresponding ownership interest in TRANSLink. We expect to earn a competitive
return on any ownership interest in TRANSLink that we may obtain. The TRANSLink
proposal is subject to receipt of all required federal and state regulatory
approvals.
NUCLEAR MANAGEMENT COMPANY
Our subsidiaries, IESU and WP&L, and Wisconsin Energy Corporation, WPS
Resources Corporation and Xcel Energy Inc. formed Nuclear Management Company in
1999 to consolidate the operation of our nuclear plants and to provide similar
capabilities for other nuclear operators and owners. After the formation of
Nuclear Management Company, an additional partner, CMS Energy Corporation,
joined the venture. We own 20% of Nuclear Management Company. Combined, the
Nuclear Management Company member utilities operate seven nuclear generating
units at five sites representing 4,500 megawatts of capacity. We and our
partners continue to own our respective plants and are entitled to the energy
S-16
generated at the plants. Each partner retains the financial obligations for the
safe operation, maintenance and the decommissioning of its plants.
We own interests in two nuclear facilities, Kewaunee Nuclear Power Plant
and Duane Arnold Energy Center. Kewaunee, a 532-megawatt plant, is operated by
Nuclear Management Company under contract to Wisconsin Public Service
Corporation and is jointly owned by Wisconsin Public Service Corporation (59.0%)
and WP&L (41.0%). The Kewaunee operating license expires in 2013. Duane Arnold,
a 535-megawatt plant, is also operated by Nuclear Management Company under
contract to IESU, which has a 70.0% ownership interest in the plant. The Duane
Arnold operating license expires in 2014. In 2000, the capacity factor for
Kewaunee was 80.9%, including the impact of a planned refueling outage, and the
capacity factor for Duane Arnold was 94.9%. For the last three years, the
capacity factor for both plants has averaged 85.0%.
IESU's and WP&L's anticipated nuclear-related construction expenditures for
2001 are approximately $41 million and for 2002 through 2005 are approximately
$42 million.
RATES AND REGULATORY ENVIRONMENT
We operate as a registered public utility holding company subject to
regulation by the Securities and Exchange Commission under the Public Utility
Holding Company Act of 1935. We and our subsidiaries are subject to the
regulatory provisions of the Public Utility Holding Company Act, including
provisions relating to the issuance and sales of securities, acquisitions and
sales of utility properties and acquisitions and retention of interests in
non-utility businesses.
As a utility holding company incorporated in Wisconsin, we are subject to
regulation by the Public Service Commission of Wisconsin, or the PSCW. The PSCW
regulates the type and amount of our investments in non-utility businesses.
WP&L, also subject to regulation by the PSCW, is generally required to file a
rate case with the PSCW every two years based on a forward-looking test year
period. However, as one of the conditions for approval of the 1998 merger which
formed our company, the PSCW required, with some exceptions, that WP&L freeze
retail electric, natural gas and water rates through April 2002. In August 2001,
WP&L filed an application with the PSCW for new rates to apply beginning April
2002. The application requested an increase in WP&L's authorized return on
investment from the current level of 11.7% to 13.5%. We cannot provide any
assurance that the PSCW will grant the requested rate increase or, if granted,
that the rate increase will be at the requested level.
In August 2001, WP&L filed a rate case with the PSCW and the new rates are
expected to go into effect in the spring of 2002. WP&L's retail electric rates
will be based in part on forecasted fuel and purchased power costs. Under the
PSCW rules, WP&L can seek emergency rate increases if the annual fuel and
purchased power costs are more than 3% higher than the estimated costs used to
establish rates. Similarly, rates are also subject to a decrease if actual costs
are more than 3% lower than estimated costs. WP&L has a gas performance
incentive that includes a sharing mechanism under which 40% of all gains and
losses relative to current commodity prices, as well as other benchmarks, are
retained or incurred by WP&L, with the remainder refunded to or recovered from
customers.
IESU and IPC both operate under the jurisdiction of the Iowa Utilities
Board. Requests for rate relief are based on historical test periods, adjusted
for some known and measurable changes. IESU and IPC also agreed to a four-year
price cap in Iowa as part of our 1998 merger approval process. IESU and IPC are
currently reviewing the potential need to file for new rates in early 2002.
IESU's and IPC's tariffs provide for subsequent adjustments to their electric
and natural gas rates for changes in the cost of fuel, purchased energy and
natural gas purchased for resale. Purchased power capacity costs are not
recovered from electric customers through this energy adjustment clause
mechanism. Recovery of these capacity costs must be addressed in formal rate
proceedings.
South Beloit Water, Gas and Electric Company, a wholly-owned subsidiary of
WP&L, is subject to regulation by the Illinois Commerce Commission. IPC is also
subject to regulation by the Minnesota Public Utilities Commission and the
Illinois Commerce Commission.
S-17
The Federal Energy Regulatory Commission has jurisdiction under the Federal
Power Act over some of the electric utility facilities and operations, wholesale
rates and accounting practices of IESU, WP&L and IPC, and in some other
respects.
WP&L and IESU are indirectly and directly subject to the jurisdiction of
the Nuclear Regulatory Commission with respect to Kewaunee Nuclear Power Plant
and Duane Arnold Energy Center, and to the jurisdiction of the U.S. Department
of Energy with respect to the disposal of nuclear fuel and other radioactive
wastes from Kewaunee Nuclear Power Plant and Duane Arnold Energy Center.
ALLIANT ENERGY RESOURCES
Through our subsidiary, Alliant Energy Resources, we manage a portfolio of
companies involved in international utility operations and non-regulated
businesses. Alliant Energy Resources' divisions include International,
Non-Regulated Generation, Investments, Trading and Integrated Services. For the
year ended December 31, 2000, our adjusted net income from non-regulated
operations represented $17.1 million of our adjusted net income.
Our overall strategic objective within this segment is to grow our
non-regulated operations to contribute more than 25% to our adjusted earnings
within the next three years. We expect funding for these growth plans to come
from a combination of external financings, sales of investments and internally
generated funds. Alliant Energy Resources currently intends to issue long-term
debt of up to $300 million guaranteed by us during the week of November 12,
2001. We expect Alliant Energy Resources to use the net proceeds from this debt
to repay its existing short-term debt and commercial paper.
The following charts show the composition of our non-regulated assets at
December 31, 2000 and non-regulated adjusted net income for the three years
ended December 31, 2000.
(Graph-Assets $2.3 billion)
INVESTMENTS OTHER TRADING INTERNATIONAL INTEGRATED SERVICES
----------- ----- ------- ------------- -------------------
56% 6% 1% 27% 10%
(Bar Chart)
ADJUSTED NET INCOME (Loss)(1) in millions)
------------------------------------------
1998 $ -6.3
1999 $ 12.5
2000 $ 17.1
---------------
(1) Adjusted net loss for 1998 excludes $2.6 million of merger-related charges.
Reported non-regulated net loss for 1998 was $8.9 million. Adjusted net
income for 1999 excludes $25.3 million of income from gains on sales of
McLeodUSA stock. Reported non-regulated net income for 1999 was $37.8
million. Adjusted net income for 2000 excludes $204.0 million of non-cash
income related to our adoption of Statement of Financial Accounting
Standards No. 133 on July 1, 2000, and $15.7 million of income from gains on
sales of McLeodUSA stock. Reported non-regulated net income for 2000 was
$236.8 million.
ALLIANT ENERGY RESOURCES STRATEGY
We believe competitive forces are reshaping the energy-services industry,
and new opportunities are available for customers to manage their energy
consumption patterns and costs. As an energy provider, we are presented with the
opportunity to intensify and adapt our relationships with our customers, and in
so doing, to increase our earnings growth and profit margins. We have relied on
our established competencies and strengths to establish new businesses that will
add growth and will complement our regulated businesses. Our strategic
objectives are to:
- Focus on opportunities that leverage management core competencies and
experience;
- Employ a disciplined approach to developing partnerships and acquiring
assets; and
- Target areas with high growth potential where meaningful competitive
positions can be established.
S-18
INTERNATIONAL
We invest in energy generation and distribution companies and projects in
developing markets throughout the world. Currently, we have operations in
Australia, Brazil, China and New Zealand. We have focused on these locations
because they offer a growing demand for energy and are receptive to foreign
investment. The investments of our international division by country as of June
30, 2001 were as follows:
[Graph--Investments by Country $604 million]
NEW ZEALAND AUSTRALIA CHINA OTHER BRAZIL
----------- --------- ----- ----- ------
11% 7% 18% 4% 60%
Our international operations include the following:
- Alliant Energy Holdings do Brasil Ltda., holds a non-controlling interest
in five Brazilian utility companies, Companhia Forca e Luz
Cataguazes-Leopoldina or Cataguazes, Celb, CENF, Energipe and Saelpa,
which together serve more than 1.6 million customers in Brazil. Working
with our local partners, we are developing two thermal generation plants
to complement the hydro generation facilities of Cataguazes. As of June
30, 2001, our total investment in Brazil was $364 million.
- Alliant Energy International has invested in three individual
cogeneration facilities in China and has a controlling interest in Peak
Pacific Investment Company Ltd. Peak Pacific was formed to develop
investment opportunities in generation infrastructure projects in China.
As of June 30, 2001, our total investment in China was $106 million. Our
objective is to increase our total investment in China up to
approximately $250 million within the next three to five years. We expect
that any additional investments in China above $250 million would be
supported by cash flows from our original investments.
- Alliant International New Zealand has made equity investments in
infrastructure and utility businesses, including TrustPower Limited,
which totaled $68 million as of June 30, 2001.
- Alliant Energy Australia holds a 69% equity interest in Southern Hydro, a
seven-plant, 479-megawatt hydro-electricity generation business that
supplies energy to the Melbourne area. As of June 30, 2001, our total
investment in Australia was $44 million.
NON-REGULATED GENERATION
On October 4, 2001, we announced an agreement with Panda Energy
International, to jointly develop and operate a 1,100-megawatt natural gas
combined-cycle power plant in western Michigan. We expect the facility to become
operational in 2004.
We estimate that the total cost of the project will be approximately $600
million. We anticipate that at least 55% of the project costs will be financed
through non-recourse debt at the joint venture level, with the remaining portion
to be provided by us. The project, currently in its early development phase, is
due to begin its two-year construction period during the first quarter of 2002,
assuming some conditions are satisfied.
We anticipate that the project will be earnings neutral during construction
but contribute positively to our earnings per share in 2004, the plant's
projected first year of operation. We expect returns on investment over the life
of the project to be between 15% and 20%.
S-19
We and Panda intend to sell a significant portion of the plant's output
under long-term contracts. We will manage power sales from the facility not
subject to such contracts. Panda will provide development services for the new
project, while Alliant Energy Resources will maintain and operate the plant. The
long lead time equipment for the project, including the turbines, is on order or
under purchase option agreements, with delivery schedules consistent with the
commercial operation start date.
INVESTMENTS
Our subsidiaries and investments include Whiting Petroleum Corporation,
Alliant Energy Transportation, Inc. and Alliant Energy Investments, Inc. Alliant
Energy Investments is a holding company whose subsidiaries include Heartland
Properties, Inc. and which holds an equity stake in McLeodUSA Incorporated.
Alliant Energy Investments also has direct and indirect equity interests in
various real estate and economic development ventures, primarily concentrated in
Iowa.
- Whiting Petroleum is based in Denver, Colorado and was organized to
purchase, develop and produce crude oil and natural gas, with an emphasis
on the acquisition of proven reserves and the production of natural gas.
Whiting Petroleum's construction and acquisition expenditures were
approximately $137 million in 2000 and are anticipated to be
approximately $130 million annually for 2001 through 2004. Alliant Energy
Resources and Whiting Petroleum use sales contracts and hedges to limit
their exposure to fluctuations in prices for crude oil and natural gas.
- Alliant Energy Transportation is a holding company whose equity
investments were $30 million as of December 31, 2000. These equity
investments include the Cedar Rapids and Iowa City Railway Company, which
is a short-line railway that provides freight service between Cedar
Rapids and Iowa City; Transfer Services, Inc., which provides transfer
and storage services; and a 75% equity investment in IEI Barge Services
Inc., which provides barge terminal and hauling services on the
Mississippi River.
- Heartland Properties performs asset management and facilitates the
development and financing of high-quality, affordable housing in
Wisconsin and the Midwest. Heartland Properties has ownership interests
in approximately 80 properties.
- We also hold an equity interest of approximately 9%, or approximately 56
million shares, in McLeodUSA Incorporated. McLeodUSA is an independent
telecommunications provider based in Cedar Rapids, Iowa. We and our
affiliates are parties to a stockholders' agreement that provides,
subject to some exceptions, that we may not sell any equity securities of
McLeodUSA until December 31, 2001 without the consent of the Board of
Directors of McLeodUSA.
TRADING
We and international commodity trader Cargill Incorporated are partners in
a joint venture, Cargill-Alliant, LLC, which is an energy-trading company that:
- Buys, sells and trades electricity for large customers and assists those
customers in minimizing risks related to changes in costs of energy; and
- Provides coal, oil and natural gas supply management, plant operations
assistance and risk-management consultation.
Cargill-Alliant LLC officially began operation in 1997 and the joint
venture agreement has an initial term expiring in October 2002.
S-20
INTEGRATED SERVICES
Alliant Energy Integrated Services Company is a national energy-services
company that offers a wide range of energy and environmental services for
businesses. It offers large energy users an array of services to maximize their
productivity, profitability and energy efficiency, and provides solutions for
waste remediation and other environmental engineering and consulting services.
Integrated Services includes Cogenex Corporation, a provider of energy
management consulting, on-site generation and energy infrastructure; Alliant
Energy Integrated Services -- Energy Management LLC, an energy procurement
company; and RMT, Inc., a provider of environmental engineering and construction
management services. These companies provide services to commercial, industrial,
institutional, educational and governmental customers.
S-21
USE OF PROCEEDS
We estimate that we will receive net proceeds from this offering, without
exercise of the underwriters' overallotment option, of approximately
$228,650,000 ($263,011,250 if the underwriters' overallotment option is
exercised in full), after deducting the underwriting discount and commissions
and estimated offering expenses payable by us. We will use the net proceeds from
this offering to repay our short-term debt. The debt to be repaid was incurred
to finance the development and construction of new utility generation,
transmission and distribution facilities, fund additional working capital,
finance capital expenditures and fund acquisitions and investments and for other
general corporate purposes.
At June 30, 2001, we had outstanding short-term borrowings, excluding
current maturities of long-term debt and including commercial paper that is
currently classified as long-term debt, of approximately $834.6 million with a
weighted average interest rate of 3.9%.
S-22
CAPITALIZATION
The following table sets forth our consolidated capitalization, including
short-term debt, as of June 30, 2001 on an actual basis and as adjusted to give
effect to the sale of 8,500,000 shares of our common stock offered in this
prospectus supplement after deducting the underwriting discount and estimated
offering expenses, and the anticipated use of the net proceeds from the offering
as described under "Use of Proceeds." The information set forth below assumes
the underwriters do not exercise their overallotment option.
AS OF JUNE 30, 2001
-------------------------------------
ACTUAL AS ADJUSTED % OF TOTAL
---------- ----------- ----------
(IN THOUSANDS)
Common stock.............................................. $ 790 $ 875
Additional paid-in capital................................ 949,609 1,178,174
Retained earnings......................................... 795,863 795,863
Accumulated other comprehensive loss...................... (36,395) (36,395)
Shares in deferred compensation trust..................... (2,063) (2,063)
---------- ----------
Total common equity.................................. 1,707,804 1,936,454 43.0%
Cumulative preferred stock of subsidiaries, net........... 113,871 113,871 2.5
Long-term debt
Long-term debt (excluding current maturities)........... 1,812,147 1,812,147 40.3
Commercial paper classified as long-term debt........... 450,000 450,000 10.0
Short-term debt
Current maturities of long-term debt................. 31,045 31,045 0.7
Other short-term borrowings.......................... 384,649 155,999 3.5
---------- ---------- -----
Total capitalization................................. $4,499,516 $4,499,516 100.0%
========== ========== =====
S-23
SELECTED FINANCIAL INFORMATION
The financial information below was selected or derived from our
consolidated financial statements. The unaudited interim period financial
information, in our opinion, includes all adjustments, which are normal and
recurring in nature, necessary for a fair presentation for the periods shown.
Results for the six months ended June 30, 2001 are not necessarily indicative of
results to be expected for the full fiscal year. The information set forth below
is qualified in its entirety by and should be read in conjunction with our
Management's Discussion and Analysis of Financial Condition and Results of
Operations and our consolidated financial statements and related notes
incorporated by reference into this prospectus supplement and the accompanying
prospectus. See "Where You Can Find More Information."
YEAR ENDED DECEMBER 31, SIX MONTHS ENDED JUNE 30,
------------------------------------ -------------------------
1998 1999 2000 2000 2001
---------- ---------- ---------- ----------- -----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
INCOME STATEMENT DATA:
Operating revenues............... $2,130,874 $2,127,973 $2,404,984 $1,097,947 $1,464,554
Operating income................. 283,302 376,535 381,056 148,557 157,294
Net income....................... 96,675 196,581 398,662 61,598 56,685
Adjustments to net income(1)..... 34,589 (25,286) (219,642) (6,714) 6,979
Adjusted net income(1)........... 131,264 171,295 179,020 54,884 63,664
Earnings per diluted share....... 1.26 2.51 5.03 0.78 0.72
Adjustments to earnings per
diluted share(1)............... 0.45 (0.32) (2.78) (0.08) 0.09
Adjusted earnings per diluted
share(1)....................... 1.71 2.19 2.26 0.70 0.81
Dividends per share.............. 2.00 2.00 2.00 1.00 1.00
AS OF DECEMBER 31, AS OF JUNE 30,
----------------------- -----------------------
1999 2000 2000 2001
---------- ---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
BALANCE SHEET DATA:
Current assets............................... $ 485,986 $ 710,981 $ 411,193 $ 552,893
Non-current assets........................... 5,589,697 6,022,785 6,185,885 5,553,515
Current liabilities.......................... 933,625 1,154,335 968,258 853,035
Non-current liabilities (excludes minority
interest).................................. 1,378,882 1,494,712 1,407,203 1,130,722
Minority interest............................ 7,208 23,341 7,189 38,829
Mandatorily redeemable preferred stock....... 27,250 27,250 27,250 27,250
Book value per share(2)...................... 27.29 25.79 27.66 21.60
---------------
(1) Adjusted net income for 1998 excludes $34.6 million, or $0.45 per share, of
merger-related charges. Adjusted net income for 1999 excludes $25.3 million,
or $0.32 per share, of income from gains on sales of McLeodUSA stock.
Adjusted net income for 2000 excludes $204.0 million, or $2.58 per share, of
non-cash income related to our adoption of Statement of Financial Accounting
Standards No. 133 on July 1, 2000, and $15.7 million, or $0.20 per share, of
income from gains on sales of McLeodUSA stock. Adjusted net income for the
six months ended June 30, 2000 excludes $6.7 million, or $0.08 per share, of
income from gains on sales of McLeodUSA stock. Adjusted net income for the
six months ended June 30, 2001 excludes $7.0 million, or $0.09 per share, of
non-cash valuation charges related to our exchangeable senior notes.
(2) Our investments in McLeodUSA are reported on our consolidated balance sheet
at their estimated fair value in accordance with U.S. generally accepted
accounting principles. As a result, the book value per share reflects net
unrealized gains, adjusted for taxes, on those investments of $8.11 per
share as of December 31, 1999, $4.01 per share as of December 31, 2000,
$8.49 per share as of June 30, 2000 and $1.14 per share as of June 30, 2001.
S-24
UNDERWRITING
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co.
Incorporated, Robert W. Baird & Co. Incorporated, Banc of America Securities
LLC, Legg Mason Wood Walker, Incorporated and Salomon Smith Barney Inc. are
acting as representatives of each of the underwriters named below. Subject to
the terms and conditions set forth in a purchase agreement among us and the
underwriters, we have agreed to sell to the underwriters, and each of the
underwriters severally and not jointly has agreed to purchase from us, the
number of shares of common stock set forth opposite its name below.
NUMBER
UNDERWRITER OF SHARES
------------------------------------------------------------ ---------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated................................... 2,454,375
Morgan Stanley & Co. Incorporated........................... 1,893,375
Robert W. Baird & Co. Incorporated.......................... 666,187
Banc of America Securities LLC.............................. 666,187
Legg Mason Wood Walker, Incorporated........................ 666,188
Salomon Smith Barney Inc.................................... 666,188
ABN AMRO Rothschild LLC..................................... 212,500
First Union Securities, Inc. ............................... 212,500
RBC Dain Rauscher Inc. ..................................... 212,500
Robertson Stephens, Inc. ................................... 212,500
U.S. Bancorp Piper Jaffray Inc. ............................ 212,500
Utendahl Capital Partners, L.P. ............................ 212,500
Wells Fargo Van Kasper, LLC................................. 212,500
---------
Total........................................ 8,500,000
=========
The underwriters have agreed, subject to the terms and conditions contained
in the purchase agreement, to purchase all of the shares of common stock sold
under the purchase agreement if any of these shares are purchased. If an
underwriter defaults, the purchase agreement provides that the purchase
commitments of the non-defaulting underwriters may be increased or the purchase
agreement may be terminated.
We have agreed to indemnify the underwriters against specified liabilities,
including liabilities under the Securities Act of 1933, or to contribute to
payments the underwriters may be required to make in respect of those
liabilities.
The underwriters are offering the shares, subject to prior sale, when, as
and if issued to and accepted by them, subject to approval of legal matters by
their counsel, including the validity of the shares and other conditions
contained in the purchase agreement, such as the receipt by the underwriters of
officer's certificates and legal opinions. The underwriters reserve the right to
withdraw, cancel or modify offers to the public and to reject orders in whole or
in part.
COMMISSIONS AND DISCOUNTS
The representatives have advised us that the underwriters propose initially
to offer the shares of common stock to the public at the public offering price
on the cover page of this prospectus supplement to certain dealers at that price
less a concession not in excess of $.60 per share. The underwriters may allow,
and the dealers may reallow, a discount not in excess of $.10 per share on sales
to other dealers. After the public offering, the public offering price,
concession and discount may be changed.
S-25
The following tables shows the public offering price, underwriting discount
and proceeds before expenses to us. This information assumes either no exercise
or full exercise by the underwriters of their overallotment option.
PER SHARE WITHOUT OPTION WITH OPTION
--------- -------------- -----------
Public offering price........................... $28.00 $238,000,000 $273,700,000
Underwriting discount........................... $1.05 $8,925,000 $10,263,750
Proceeds, before expenses, to Alliant Energy
Corporation................................... $26.95 $229,075,000 $263,436,250
The expenses of this offering, not including the underwriting discount, are
estimated at $425,000 and are payable by us.
OVERALLOTMENT OPTION
We have granted an option to the underwriters to purchase up to 1,275,000
additional shares of common stock at the public offering price on the cover page
of this prospectus supplement, less the underwriting discount. The underwriters
may exercise this option for 30 days from the date of this prospectus supplement
solely to cover overallotments. If the underwriters exercise this option, each
underwriter will be obligated, subject to conditions contained in the purchase
agreement, to purchase a number of additional shares proportionate to that
underwriter's initial amount reflected in the table.
NO SALE OF SIMILAR SECURITIES
We have agreed, with exceptions, not to sell or transfer any of our common
stock for 90 days after the date of this prospectus supplement without first
obtaining the written consent of the representatives. Specifically, we have
agreed not to directly or indirectly:
- Offer, pledge, sell or contract to sell any common stock;
- Sell any option or contract to purchase any common stock;
- Purchase any option or contract to sell any common stock;
- Grant any option, right or warrant to sell any common stock;
- Lend or otherwise dispose of or transfer any common stock;
- Request or demand that we file a registration statement related to the
common stock; or
- Enter into swap or other agreement that transfers, in whole or in part,
the economic consequence of ownership of any common stock whether any
such swap or transaction is to be settled by delivery of shares or other
securities, in cash or otherwise.
This lockup provision applies to common stock and to securities convertible
into or exchangeable or exercisable for or repayable with common stock.
PRICE STABILIZATION AND SHORT POSITION
Until the distribution of the common stock offered hereby is completed,
Securities and Exchange Commission rules may limit the underwriters and selling
group members from bidding for or purchasing our common stock. However, the
representatives may engage in transactions that stabilize the price of the
common stock, such as bids or purchases to peg, fix or maintain that price.
If the underwriters create a short position in the common stock in
connection with the offering, i.e., if they sell more shares than are listed on
the cover page of this prospectus supplement, the representatives may reduce
that short position by purchasing common stock in the open market. The
representatives may also elect to reduce any short position by exercising all or
part of the overallotment option described above.
S-26
Purchases of our common stock to stabilize or reduce a short position could
cause the price of our common stock to be higher than it might be in the absence
of such purchases.
Neither we nor any of the underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the common stock. In addition, neither
we nor any of the underwriters makes any representation that the representatives
will engage in these transactions or that these transactions, once commenced,
will not be discontinued without notice.
OTHER RELATIONSHIPS
Some of the underwriters or their affiliates have provided investment or
commercial banking services to us in the past and are likely to do so in the
future. They receive customary fees and commissions for these services.
S-27
PROSPECTUS
12,000,000 SHARES
[ALLIANT ENERGY LOGO]
ALLIANT ENERGY CORPORATION
COMMON STOCK
---------------------
By this prospectus, we may offer from time to time up to 12,000,000 shares
of our common stock. Our common stock is listed on the New York Stock Exchange
under the symbol "LNT."
When we offer common stock, we will provide you with a prospectus
supplement describing the terms of the specific issue of common stock including
the offering price.
---------------------
You should read this prospectus and the prospectus supplement relating to
the specific issue of common stock carefully before you invest.
---------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
---------------------
The date of this prospectus is October 16, 2001.
TABLE OF CONTENTS
PAGE
----
About This Prospectus....................................... 2
Alliant Energy Corporation.................................. 3
Use of Proceeds............................................. 3
Price Range of Common Stock and Dividend Policy............. 4
Description of Common Stock................................. 5
Plan of Distribution........................................ 7
Where You Can Find More Information......................... 7
Legal Matters............................................... 8
Experts..................................................... 8
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission utilizing a "shelf" registration process.
Under this shelf process, we may, from time to time, sell the shares of our
common stock described in this prospectus in one or more offerings up to a total
number of 12,000,000 shares. This prospectus provides you with a general
description of the shares that we may offer. Each time we offer shares, we will
provide a prospectus supplement that will contain specific information about the
terms of that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this prospectus
and any prospectus supplement together with additional information described
under the heading "Where You Can Find More Information." Unless we otherwise
indicate or unless the context requires otherwise, all references in this
prospectus to "we," "our," "us" or similar references mean Alliant Energy
Corporation.
2
ALLIANT ENERGY CORPORATION
We are a public utility holding company with a diversified portfolio of
energy businesses. Our regulated public utility subsidiaries, Wisconsin Power
and Light Company, IES Utilities Inc. and Interstate Power Company, are engaged
principally in:
- the generation, transmission, distribution and sale of electric energy;
- the purchase, distribution, transportation and sale of natural gas; and
- water and steam services in selected markets.
The principal markets of our utility subsidiaries are located in Iowa,
Wisconsin, Minnesota and Illinois.
Through our subsidiary, Alliant Energy Resources, Inc., we manage a
portfolio of companies involved in non-regulated businesses. These businesses
include:
- global partnerships to develop energy generation, delivery and
infrastructure in growing international markets;
- domestic companies that provide integrated services, including energy,
environmental, engineering and transportation services;
- Cargill-Alliant, LLC, our energy trading joint venture with Cargill
Incorporated; and
- other investments, including our oil and natural gas operations.
Our principal executive offices are located at 222 West Washington Avenue,
Madison, Wisconsin 53703, and our telephone number is (608) 252-3311.
USE OF PROCEEDS
Unless otherwise specified in the applicable prospectus supplement, we will
use the net proceeds from the sale of our common stock to make additional
capital contributions to our subsidiaries or to repay our debt or the debt of
our subsidiaries. Our subsidiaries may use these capital contributions for
financing the development and construction of new generation, transmission and
distribution facilities, funding additional working capital, financing capital
expenditures, funding potential acquisitions and investments and other general
corporate purposes. Until we use the net proceeds from the sale of common stock
for these purposes, we may use the net proceeds for temporary investments.
3
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
Our common stock is listed on the New York Stock Exchange under the symbol
"LNT." The following table shows the high and low reported closing sale prices
of the common stock on the New York Stock Exchange for the stated calendar
quarter.
PRICE OF
COMMON STOCK
---------------
HIGH LOW
------ ------
2001
First Quarter............................................. $33.20 $28.75
Second Quarter............................................ 32.67 28.20
Third Quarter............................................. 31.49 27.90
2000
First Quarter............................................. $37.75 $26.44
Second Quarter............................................ 31.88 25.75
Third Quarter............................................. 31.25 26.13
Fourth Quarter............................................ 32.13 28.63
1999
First Quarter............................................. $32.38 $26.38
Second Quarter............................................ 30.88 26.50
Third Quarter............................................. 30.06 26.75
Fourth Quarter............................................ 28.81 25.19
In 1999, 2000 and the first two quarters of 2001, we paid quarterly cash
dividends of $0.50 per share of our common stock.
We currently intend to declare and pay dividends on a regular basis at the
current rate. We have paid cash dividends every consecutive quarter for the past
56 years. However, the payment and amount of future dividends is at the
discretion of our board of directors and will depend upon our future earnings,
capital requirements, and general financial condition, general business
conditions, the ability of our subsidiaries to pay dividends to us and other
factors. Our primary source of funds for the payment of dividends to our
shareowners is dividends our subsidiaries pay to us. Our utility subsidiaries
each have dividend payment restrictions based on their respective bond
indentures, the terms of their outstanding preferred stock and state regulatory
limitations applicable to them.
4
DESCRIPTION OF COMMON STOCK
Our articles of incorporation provide that we have authority to issue
200,000,000 shares of common stock. The Securities and Exchange Commission has
authorized us under the Public Utility Holding Company Act of 1935 to issue the
shares to be offered pursuant to this prospectus.
The following summary of some provisions of our common stock is not
complete. You should refer to our articles of incorporation and our rights
agreement, which are incorporated by reference as exhibits to the registration
statement of which this prospectus is a part, and applicable law for more
information.
Common Stock
All of the issued and outstanding shares of our common stock are fully paid
and nonassessable, and the shares of common stock being sold by us will, upon
completion of the offering, be fully paid and nonassessable, except in each case
for statutory liability under Section 180.0622(2)(b) of the Wisconsin Business
Corporation Law for unpaid employee wages.
Our common stock is entitled to such dividends as may be declared from time
to time by our board of directors in accordance with applicable law. Our ability
to pay dividends is dependent upon a number of factors, including the ability of
our subsidiaries to pay dividends to us. Our utility subsidiaries each have
restrictions on the payment of dividends on their common stock based on their
respective bond indentures, the terms of their outstanding preferred stock and
regulatory restrictions applicable to them.
Only the holders of common stock will be entitled to vote for the election
of members to our board of directors and on all other matters. Holders of our
common stock are entitled to one vote per share of common stock held by them on
all matters properly submitted to a vote of shareowners, subject to Section
180.1150 of the Wisconsin Business Corporation Law. See "-- Statutory
Provisions." Shareowners have no cumulative voting rights, which means that the
holders of shares entitled to exercise more than 50% of the voting power are
able to elect all of the directors to be elected at any one meeting of
shareowners. Our board of directors is divided into three classes, with
staggered terms of three years each.
All shares of common stock are entitled to participate equally in
distributions in liquidation. Holders of common stock have no preemptive rights
to subscribe for or purchase our shares. There are no conversion rights, sinking
fund or redemption provisions applicable to our common stock. We do not have the
authority to issue any shares of preferred stock.
The transfer agent for our common stock is our subsidiary, Alliant Energy
Corporate Services, Inc.
Common Share Purchase Rights
We have entered into a rights agreement pursuant to which each outstanding
share of our common stock, including those shares being sold by us pursuant to
this prospectus, has attached a right to purchase one-half of one share of our
common stock. Each share of our common stock subsequently issued by us prior to
the expiration of the rights agreement will likewise have attached a right.
Under circumstances described below, the rights will entitle the holder of the
rights to purchase additional shares of our common stock. In this prospectus and
any accompanying prospectus supplement, unless the context requires otherwise,
all references to our common stock include the accompanying rights.
Currently, the rights are not exercisable and trade with our common stock.
If the rights become exercisable, each full right, unless held by a person or
group that beneficially owns more than 15% of our outstanding common stock, will
initially entitle the holder to purchase one half of one share of our common
stock at a purchase price of $95 per full share, or $47.50 per half share,
subject to adjustment. The rights will become exercisable only if a person or
group has acquired, or announced an intention to acquire, 15% or more of our
outstanding common stock. Under some circumstances, including the existence of a
15% acquiring party, each holder of a right, other than the acquiring party,
will be entitled to purchase at the right's then-current exercise price, shares
of our common stock having a market value of two times the exercise price. If
another corporation acquires us after a party acquires 15% or more of
5
our common stock, each holder of a right will be entitled to receive the
acquiring corporation's common shares having a market value of two times the
exercise price. The rights may be redeemed at a price of $0.001 until a party
acquires 15% or more of our common stock and, after that time, may be exchanged
for one share of our common stock per right until a party acquires 50% or more
of our common stock. The rights expire on January 20, 2009, subject to
extension. Under the rights agreement, our board of directors may reduce the
thresholds applicable to the rights from 15% to not less than 10%. The rights do
not have voting or dividend rights and, until they become exercisable, have no
dilutive effect on our earnings.
Statutory Provisions
Because we are a public utility holding company under the Public Utility
Holding Company Act of 1935, the SEC must approve the acquisition of any of our
securities or utility assets by a registered public utility holding company or
any person who would, as a result of such acquisition, become an affiliate of
two or more public utility companies.
Section 180.1150 of the Wisconsin Business Corporation Law provides that
the voting power of public Wisconsin corporations such as us held by any person
or persons acting as a group in excess of 20% of our voting power is limited to
10% of the full voting power of those shares, unless full voting power of those
shares has been restored pursuant to a vote of shareowners. Sections 180.1140 to
180.1144 of the Wisconsin Business Corporation Law contain some limitations and
special voting provisions applicable to specified business combinations
involving Wisconsin corporations such as us and a significant shareowner, unless
the board of directors of the corporation approves the business combination or
the shareowner's acquisition of shares before these shares are acquired.
Similarly, Sections 180.1130 to 180.1133 of the Wisconsin Business
Corporation Law contain special voting provisions applicable to some business
combinations, unless specified minimum price and procedural requirements are
met. Following commencement of a takeover offer, Section 180.1134 of the
Wisconsin Business Corporation Law imposes special voting requirements on share
repurchases effected at a premium to the market and on asset sales by the
corporation, unless, as it relates to the potential sale of assets, the
corporation has at least three independent directors and a majority of the
independent directors vote not to have the provision apply to the corporation.
Section 196.795(3) of the Wisconsin Statutes provides that no person may
hold or acquire directly or indirectly more than 10% of the outstanding
securities of a public utility holding company such as us without the approval
of the Public Service Commission of Wisconsin.
6
PLAN OF DISTRIBUTION
We may sell the common stock being offered hereby in one or more of the
following ways from time to time:
- to underwriters for resale to the public or to institutional investors;
- directly to institutional investors;
- directly to agents;
- through agents to the public or to institutional investors; or
- if indicated in the prospectus supplement, pursuant to delayed delivery
contracts, by remarketing firms or by other means.
The prospectus supplements will set forth the terms of the offering of
common stock, including the name or names of any underwriters or agents, the
purchase price of the common stock and the proceeds to us from the sale, any
underwriting discounts or agency fees and other items constituting underwriters'
or agents' compensation and any discounts or concessions allowed or reallowed or
paid to dealers.
If underwriters are utilized in the sale, the common stock will be acquired
by the underwriters for their own account under an underwriting agreement that
we will execute with the underwriters at the time an agreement for such sale is
reached, and may be resold from time to time in one or more transactions,
including negotiated transactions, at a fixed public offering price or prices,
which may be changed, or at market or varying prices determined at the time of
sale.
Unless otherwise set forth in a prospectus supplement, the obligations of
the underwriters to purchase common stock will be subject to conditions
precedent and the underwriters will be obligated to purchase all of the common
stock if any is purchased.
If a dealer is utilized in the sale of the common stock, we will sell the
common stock to the dealer, as principal. The dealer may then resell the common
stock to the public at varying prices to be determined by the dealer at the time
of resale.
Underwriters, agents and dealers may be entitled under agreements entered
into with us to be indemnified by us against civil liabilities, including
liabilities under the Securities Act of 1933, or to contribution with respect to
payments which the underwriters or agents may be required to make in respect
thereof. Underwriters, agents and dealers may be customers of, engage in
transactions with, or perform services for us and our subsidiaries and
affiliates in the ordinary course of business.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. We have also filed a registration statement on Form
S-3, including exhibits, under the Securities Act of 1933 with respect to the
common stock offered by this prospectus. This prospectus is a part of the
registration statement, but does not contain all of the information included in
the registration statement or the exhibits. You may read and copy the
registration statement and any other document which we file at the SEC's public
reference rooms at 450 Fifth Street, N.W., Washington D.C., and at regional SEC
offices in Chicago, Illinois. You can call the SEC at 1-800-SEC-0330 for further
information on the operation of the public reference rooms. You can also find
our public filings with the SEC on the internet at a web site maintained by the
SEC located at http://www.sec.gov.
We are "incorporating by reference" specified documents that we file with
the SEC, which means:
- incorporated documents are considered part of this prospectus;
- we are disclosing important information to you by referring you to those
documents; and
7
- information we file with the SEC will automatically update and supersede
information contained in this prospectus.
We incorporate by reference the documents we list below and any future
filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 after the date of this prospectus and before the
end of the offering of our common stock:
- our Annual Report on Form 10-K for the year ended December 31, 2000;
- our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2001
and June 30, 2001;
- our Current Report on Form 8-K, dated February 20, 2001 and filed
February 20, 2001, as amended by our Current Report on Form 8-K/A, dated
February 20, 2001 and filed March 1, 2001;
- the description of our common stock contained in our Registration
Statement on Form 8-B, dated April 1, 1988, and any amendment or report
updating that description; and
- the description of our common share purchase rights contained in our
Registration Statement on Form 8-A, dated January 20, 1999, and any
amendment or report updating that description.
You may request a copy of any of these filings, at no cost, by writing to
Edward M. Gleason, Vice President-Treasurer and Corporate Secretary, Alliant
Energy Corporation, 222 West Washington Avenue, Madison, Wisconsin 53703, or by
calling Mr. Gleason at (608) 252-3311.
LEGAL MATTERS
The validity of the shares of our common stock offered by this prospectus
will be passed upon for us by Foley & Lardner, Milwaukee, Wisconsin. Some legal
matters will be passed upon for the underwriters, dealers, purchasers or agents
by Gibson, Dunn & Crutcher LLP, New York, New York.
EXPERTS
The audited financial statements and schedules incorporated by reference in
this prospectus and elsewhere in the registration statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
report.
8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
8,500,000 SHARES
[ALLIANT ENERGY LOGO]
ALLIANT ENERGY CORPORATION
COMMON STOCK
----------------------------------
PROSPECTUS SUPPLEMENT
----------------------------------
MERRILL LYNCH & CO.
MORGAN STANLEY
ROBERT W. BAIRD & CO.
BANC OF AMERICA SECURITIES LLC
LEGG MASON WOOD WALKER
INCORPORATED
SALOMON SMITH BARNEY
NOVEMBER 8, 2001
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