Business Acquisitions (Tables)

12 Months Ended

Dec. 31, 2011

Business Acquisition [Line Items]

Purchase Price and Related Purchase Price Allocation

The fair value of the consideration paid for Central Networks was as follows (in billions).

Aggregate enterprise consideration	$	6.6
Less: fair value of long-term debt outstanding assumed through consolidation		0.8
Total cash consideration paid		5.8
Less: funds used to repay pre-acquisition affiliate indebtedness		1.7
Cash consideration paid for Central Networks' outstanding ordinary share capital	$	4.1

The following table summarizes (in billions) the allocation of the purchase price of WPD Midlands to the fair value of the major classes of assets acquired and liabilities assumed.

Current assets (a)	$	0.2
PP&E		4.9
Intangible assets		0.1
Other noncurrent assets		0.1
Current liabilities (b)		(0.4)
PPL WEM affiliate indebtedness		(1.7)
Long-term debt (current and noncurrent) (b)		(0.8)
Other noncurrent liabilities (b)		(0.7)
Net identifiable assets acquired		1.7
Goodwill		2.4
Net assets acquired	$	4.1

(a)       Includes gross contractual amount of the accounts receivable acquired of $122million, which approximates fair value.

(b)       Represents non-cash activity excluded from the 2011 Statement of Cash Flows.

The fair value of the consideration paid for E.ON U.S. LLC was as follows (in billions).

Aggregate enterprise consideration	$	7.6
Less: fair value of assumed long-term debt outstanding, net		0.8
Total cash consideration paid		6.8
Less: funds used to repay pre-acquisition affiliate indebtedness		4.3
Cash consideration paid for E.ON U.S. LLC equity interests	$	2.5

The following table summarizes (in billions) the allocation of the purchase price of LKE to the fair value of the major classes of assets acquired and liabilities assumed.

Current assets (a)	$	0.9
PP&E		7.5
Other intangibles (current and noncurrent)		0.4
Regulatory and other noncurrent assets		0.7
Current liabilities, excluding current portion of long-term debt (b)		(0.5)
PPL affiliate indebtedness (c)		(4.3)
Long-term debt (current and noncurrent) (b)		(0.9)
Other noncurrent liabilities (b)		(2.3)
Net identifiable assets acquired		1.5
Goodwill		1.0
Net assets acquired	$	2.5

(a)       Includes gross contractual amount of the accounts receivable acquired of $186 million. PPL expected $11 million to be uncollectible; however, credit risk is mitigated since uncollectible accounts are a component of customer rates.

(b)       Represents non-cash activity excluded from the 2010 Statement of Cash Flows.

(c)       Includes $1.6 billion designated as a capital contribution to LKE.

Separation Benefits

The separation benefits, before income taxes, associated with the reorganization are as follows.

Severance compensation	$	58
Early retirement deficiency costs (ERDC) under applicable pension plans		45
Outplacement services		1
Total separation benefits	$	104

The carrying amount of accrued severance was as follows.

Severance compensation	$	48
Severance paid (a)		(27)
Accrued severance at December 31, 2011	$	21

(a)       Payments to approximately 350 employees separated.

Nonrecurring Adjustments to Pro-forma Information

Nonrecurring adjustments include the following pre-tax credits (expenses).

		Income Statement
		Line Item	2011		2010
WPD Midlands acquisition
	2011 Bridge Facility costs	Interest Expense	$	(44)
	Foreign currency loss on 2011 Bridge Facility	Other Income (Expense) - net		(57)
	Net hedge gains	Other Income (Expense) - net		55
	Hedge ineffectiveness	Interest Expense		(12)
	U.K. stamp duty tax	Other Income (Expense) - net		(21)
	Separation benefits	Other operation and maintenance		(102)
	Other acquisition-related costs	(a)		(77)
LKE acquisition
	2010 Bridge Facility costs	Interest Expense			$	(80)
	Other acquisition-related costs	Other Income (Expense) - net				(31)

(a)Primarily includes advisory, accounting and legal fees recorded in "Other Income (Expense) - net" and contract termination costs, rebranding costs and relocation costs recorded in "Other operation and maintenance."

Pro-forma Information

WPD Midlands' operating revenues,net income and net income excluding nonrecurring acquisition-related adjustments (which are recorded on a one-month lag) included in PPL's 2011 Statement of Income and included in the International Regulated segment, are as follows.

Operating revenues	$	790
Net Income		137
Net Income – excluding nonrecurring acquisition-related adjustments		281

The pro forma operating revenues and net income attributable to PPL, which include LKE as if the acquisition had occurred January 1, 2009 and WPD Midlands as if the acquisition had occurred January 1, 2010, are as follows.

	2011		2010
Operating Revenues - PPL consolidated pro forma (unaudited)	$	13,140	$	11,850
Net Income Attributable to PPL - PPL consolidated pro forma (unaudited)		1,800		1,462

The actual LKE operating revenues and net income attributable to PPL included in PPL's 2010 Statement of Income are as follows.

			Net Income
			(Loss)
	Operating		Attributable
	Revenues		to PPL
Actual from November 1, 2010 – December 31, 2010	$	493	$	47

The push-down accounting for the fair value of assets acquired and liabilities assumed was as follows (in millions).