NEW ORLEANS, Nov. 22, 2004 (PRNewswire-FirstCall) — Entergy Corporation announced that Entergy-Koch, LP has entered into a definitive agreement to sell Gulf South Pipeline Company, LP (Gulf South) to TGT Pipeline, LLC, a subsidiary of Loews Corporation, for a purchase price of $1.136 billion. The sale of Gulf South is expected to occur prior to year-end and is subject to normal and customary conditions, including the filing of notification under the Hart-Scott-Rodino antitrust law.
Entergy expects the sale of Gulf South, combined with the previously announced sale of Entergy-Koch Trading, to result in a net cash impact to Entergy of more than $1 billion, the majority of which will be received by the end of the first quarter of 2005.
Entergy noted that previously-issued 2004 as-reported earnings guidance of $3.65 to $3.75 per share will be revised to reflect actual results realized by Entergy-Koch, LP in fourth quarter 2004, as well as the gain that will be realized on the combination of the sales of Entergy-Koch Trading, Gulf South and the eventual completion of the Entergy-Koch, LP venture when these amounts are known.
Entergy affirmed previously-issued operational earnings guidance for 2004 in the range of $3.70 to $3.80 per share. Operational earnings exclude results of $(0.07) per share from Entergy-Koch, LP and $0.02 per share related to a special item at Entergy’s non-nuclear wholesale assets business. Operational earnings exclude these amounts because they will not recur in 2005 and beyond.
The company also affirmed previously-issued as-reported and operational earnings guidance for 2005 in the range of $4.60 to $4.85 per share, and noted that this range reflects share repurchases under the previously-announced $1.5 billion program that is in effect through year-end 2006.
Gulf South is a subsidiary of Entergy-Koch, LP, a 50/50 venture jointly owned by Entergy Corporation and Koch Energy, Inc. The sale of Gulf South follows a competitive process that commenced shortly after the September 2, 2004 announcement to sell Entergy-Koch’s energy trading businesses to Merrill Lynch & Co. Both transactions resulted from a review of strategic alternatives conducted by Entergy-Koch’s owners which concluded that Entergy-Koch’s trading and pipeline businesses were likely to be more valuable if owned by separate third parties. Competitive processes were conducted for both sales. Lehman Brothers advised Entergy-Koch, LP on the sale of Gulf South.
About Entergy Corporation [ www.entergy.com ]
Entergy Corporation is an integrated energy company engaged primarily in electric power production, retail distribution operations, and gas transportation. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, and it is the second-largest nuclear generator in the United States. Entergy delivers electricity to 2.6 million utility customers in Arkansas, Louisiana, Mississippi, and Texas. Entergy has annual revenues of over $9 billion and approximately 14,000 employees.
Additional investor information can be accessed online at http://www.entergy.com/earnings