Acquisitions

Strategic Communications for Private Equity Buyout

A large electric utility faced possible devalued stock as a result of intense local and national public opposition to its proposal to build multiple coal plants. The state legislature, responding to consumer outrage over high electricity prices, was aggressively moving forward with legislation to cap prices and force the company to divest major assets as well as re-regulate a deregulated market. Regulators were recommending record-setting fines for alleged market manipulation. In early 2007, amid all this, the company accepted a buyout proposal from a team of private equity investors.

The investors faced a range of regulatory, legislative and public risks that could have prevented the completion of the transaction.

Public Strategies advised the coalition of investors and led the coordination and management of a campaign-style communications effort to neutralize the company’s critics and build support for the buyout among state legislators, community groups, consumer advocates, and regulatory agencies.

The intensive campaign to reverse negative public sentiment was critical to the success of the transaction. With our campaign strategy and coordination, the investment group was able to successfully navigate the state legislative session and establish positive working relationships with elected officials, advocates and consumers.

By building a coalition of supporters, many of whom were “old company” adversaries turned “new company” allies, we ensured that the investors gained approval for the buyout and established a positive direction for the new company moving forward.

Ultimately, 74 percent of shareholders approved the buyout and our clients were able to successfully complete the transaction.