As previously disclosed on Form 8-Ks filed on February 8, 2007, February 1, 2008 and April 30, 2008, Black Hills Corporation (the “Company”) entered into agreements with Aquila, Inc. (“Aquila”) to acquire the gas utilities operated by Aquila in Colorado, Iowa, Kansas and Nebraska, and the electric utility operated by Aquila in Colorado, together with certain related assets, for $940 million in cash. At the same time we entered into our agreements with Aquila, Aquila also entered into an agreement with Great Plains Energy Incorporated (“Great Plains”) for the merger of a subsidiary of Great Plains with and into Aquila. Each transaction was contingent on the completion of the other transaction, meaning that one transaction could not be completed unless the other transaction was completed.

On July 14, 2008, all conditions to closing were met and the Company completed the purchase of the four natural gas utilities in Colorado, Iowa, Kansas and Nebraska, the electric utility in Colorado and certain related assets. The $940 million purchase price was financed through a $380 million borrowing on the Company’s $1 billion acquisition facility and from cash proceeds generated from the Company’s sale of seven independent power plants on July 11, 2008.

On July 14, 2008, in conjunction with the closing of the Aquila acquisition described under Item 2.01 above, the Company borrowed $380 million under its $1 billion acquisition Credit Agreement dated May 7, 2007. The loan matures on February 5, 2009, and bears interest either at the prime rate if it is a Base Rate Loan or at LIBOR plus 0.55% if it is a Euro Dollar Loan. The initial loan is a Base Rate Loan bearing interest at 5.0%. The Credit Agreement dated as of May 7, 2007, filed as Exhibit 10.3 to the Company’s Form 10-Q for the quarterly period ended June 30, 2007, is incorporated herein by reference.

On July 14, 2008, the Company issued a press release announcing the completion of the purchase of the Aquila properties. A copy of the press release is attached hereto as Exhibit 99.1. This press release is being “furnished” and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

The financial statements of the assets acquired will be filed by amendment to this report no later than September 29, 2008.

The pro forma financial information of the Company reflecting the assets acquired will be filed by amendment to this report no later than September 29, 2008.

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Page 2, Black Hills Corp. Completes Purchase

The acquired Aquila utilities will operate under the name “Black Hills Energy.” In the coming months, the company’s trucks, signs and customer bills will be branded with the new name. More information will be available in future communications.

Customers will continue to receive the same trusted coverage and service they have come to depend on. They will benefit from enhancements to programs and services, including service from Aquila’s Lincoln, Neb., call center and a new call center operating in Rapid City.

Black Hills on Feb. 7, 2007, announced its intent to acquire the four Aquila gas utilities and one electric utility and began an extensive approval process. Black Hills’ purchase of these assets was cross-contingent with the merger of Great Plains Energy and Aquila. The Missouri Public Service Commission on July 1, 2008, issued the order granting the final regulatory approval needed to complete the transaction, and the order became effective today. All three companies’ boards of directors approved the asset purchase/sale and merger agreements, as did shareholders of Aquila and Great Plains Energy, the company purchasing Aquila’s Missouri assets. The transaction also received approvals from state regulatory commissions in the four other states involved in the sale and the Federal Energy Regulatory Commission, and passed Hart-Scott-Rodino antitrust review.

IPP SALE PROCEEDS UTILIZED FOR AQUILA PURCHASE

The pre-tax net cash proceeds received upon the close of the IPP sale were approximately $756 million, including the effects of approximately $67.5 million of associated project level debt repayment, estimated working capital adjustments and other costs. Additionally, the company expects to make income tax payments associated with the gain on the IPP asset sale of approximately $50 million to $75 million. Through tax planning, the company expects to defer tax payments in the range of $135 million to $160 million. The pre-tax book gain on the IPP sale is in the range of $225 million to $250 million.

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