As explained by Facebook:
"Starting later this week, advertisers will begin to see an updated Ads Manager interface where they previously found Ads Manager or Power Editor. The updated Ads Manager interface is designed to feel familiar without sacrificing any capabilities advertisers enjoyed from the old Power Editor or Ads Manager."
The new tool will enable users to choose which workflow style they prefer - Power Editor's quick creation or Ads Manager's guided tools, with an option to choose a preferred work style in the updated interface.
You can see the 'guided' or 'quick' creation options in the above prompt
Once you've made your choice, that'll become the default creation option for your process from then on - though you will be able to switch if you choose. Having optional workflows will enable Facebook to better transition users of both tools, minimizing disruption.
You'll be able switch creation styles in the updated app
Facebook also notes that Power Editor's automatic drafts will be added to the new Ads Manager, while the new tool will have advanced reporting functionality, combining the data features of the two apps.
Importantly, Facebook says that Power Editor users "won't notice any changes with ad creation and management except the new name". So if you're used to being able to create ads through Power Editor's more advanced options, you shouldn't have any problems - though the Power Editor name is being retired.
Merging the two tools seems like a logical option, helping advertisers understand the extent of the ad targeting options on offer as they get a better understanding of the Facebook ad creation process.
Facebook's provided a video explanation and listing of the changes here for further clarification.