Proceeds will finance portion of SourceGas Holdings LLC acquisition

Black Hills Corp. (BKH) today announced that it plans to conduct concurrent registered public offerings, subject to market conditions and other factors, of up to 5.5 million shares of its common stock and 5.2 million equity units (aggregate stated amount of $260 million of equity units). Net proceeds from these offerings will be used to partially fund the pending acquisition of SourceGas Holdings LLC, which is expected to close in the first half of 2016.

Black Hills intends to grant the underwriters a 30-day option to purchase up to an additional 825,000 shares of its common stock and a 13-day option to purchase up to an additional 780,000 equity units, upon the same terms as their respective offerings.

Each equity unit will be issued in a stated amount of $50 and will initially consist of a contract to purchase Black Hills common stock and a 1/20, or 5%, undivided beneficial ownership interest in $1,000 principal amount of remarketable junior subordinated notes due 2028. Pursuant to the purchase contracts, holders are required to purchase Black Hills common stock no later than Nov. 1, 2018.

Credit Suisse and BofA Merrill Lynch are lead book-running managers, and RBC Capital Markets and Wells Fargo Securities are joint book-running managers, for the common stock offering. BMO Capital Markets is senior co-manager, and J.P. Morgan, Morgan Stanley, Scotia Howard Weil and MUFG are co-managers, for the common stock offering. Credit Suisse and Wells Fargo Securities are lead book-running managers, and RBC Capital Markets and BofA Merrill Lynch are joint book-running managers, for the equity units offering. J.P. Morgan, Morgan Stanley and US Bancorp are co-managers for the equity units offering.

Both offerings are being made pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission, and each offering will be made only by means of a prospectus supplement for such offering and an accompanying prospectus. Copies of the prospectus supplements and accompanying prospectus relating to the common stock and equity units offerings may be obtained from Credit Suisse Securities, One Madison Avenue, New York, NY 10010-3629, Attention: Prospectus Department, by calling toll free 1-800-221-1037 or by email at[email protected]; from BofA Merrill Lynch, 222 Broadway, New York, NY 10038, Attn: Prospectus Department, email [email protected]; from Wells Fargo Securities, LLC, Attention: Equity Syndicate Department, 375 Park Avenue, New York, NY 10152, telephone: 1-800-326-5897 or email: [email protected]; or from RBC Capital Markets, LLC, 200 Vesey Street, 8th Floor, New York, NY 10281; Attention: Equity Syndicate Department, Telephone: 1-877-822-4089, or email: [email protected]

The common stock offering is not contingent on the equity units offering, and the equity units offering is not contingent on the common stock offering. This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in any state or jurisdiction in which it is unlawful to make an offer, solicitation or sale.

Black Hills Corporation
Black Hills Corp. (BKH) is a growth-oriented, vertically-integrated energy company with a tradition of improving life with energy and a vision to be the energy partner of choice. Based in Rapid City, S.D., the company serves 792,000 natural gas and electric utility customers in Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. The company also generates wholesale electricity and produces natural gas, oil and coal. Black Hills Corp.`s more than 2,000 employees form partnerships and produce positive results for our customers, communities and shareholders.


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