MERGERS & ACQUISITIONS
TNP acquisition complete: TNP Enterprises Inc., the parent of Texas-New Mexico Power Co., completed its transition to a new ownership group, led by William J. Catacosinos, managing partner of Laurel Hill Capital Partners LLC. The new owners also include CIBC World Markets and other financial institutions. The transaction was valued at $1 billion, including assumed debt.
MAPP, MAIN approve MOU: The Mid-Continent Area Power Pool (MAPP) and the Mid-America Interconnected Network (MAIN) approved in early April the execution of a Memorandum of Understanding (MOU) to merge the reliability functions of the two organizations. The next step is to develop definitive agreements, expected to be completed by July, for the implementation of the MOU. The goal is to have the new Regional Reliability Organization operational by November.
LG&E Energy, PowerGen plc to merge: Louisville, Ky.-based LG&E Energy and PowerGen plc of the United Kingdom recently filed applications with the Federal Energy Regulatory Commission and the Virginia State Corporation Commission. The Virginia filing is necessary because LG&E Energy subsidiary Kentucky Utilities operates in five Virginia counties under the name Old Dominion Power. Earlier, the utilities filed a merger application in Kentucky. The merger is slated to close late this year or in early 2001.
Con Edison shareholders approve merger: Consolidated Edison Inc. received approval from its shareholders for its pending acquisition of Northeast Utilities. The merger has a value of about $7.5 billion, including Northeast Utilities’ debt, capitalized leases and preferred securities.
Southern Co., Washington Gas Energy form alliance: Southern Company Energy Marketing announced an alliance with Washington Gas Energy Services to supply the regional natural gas retailer with wholesale electricity and power scheduling services. Southern Company Energy Marketing will support Washington Gas Energy Services’ entry into the competitive electricity market in Maryland, which opens July 1.
Enron deals with IBM & Sonoco: Enron Energy Services, a subsidiary of Enron Corp., announced a $610 million agreement to provide electricity to IBM over the next 10 years. Enron will supply or procure electricity for a number of IBM facilities across the United States, mitigate the risks of price volatility and manage energy information to provide IBM with a consolidated monthly invoice. In a six-year, $210 million agreement with Sonoco, Enron will manage electricity supply to more than 150 manufacturing plants and facilities nationwide.
PROJECTS & CONTRACTS
GE Power Systems supplies GTs to FPL Group: FPL Group Inc. and General Electric Co. announced a $3.7 billion multi-year agreement for GE Power Systems to supply 66 7FA advanced technology gas turbines (GTs), as well as parts, repairs and onsite services. The GTs will support the expansion at FPL Group’s subsidiary, Florida Power & Light Co., as well as the corporation’s independent power production subsidiary, FPL Energy LLC. GE will deliver the turbines starting this year through 2004 and will provide support services through 2011.
PG&E builds largest wind facility in East: PG&E Corp.’s National Energy Group broke ground in mid-April for its Madison Windpower Project, the largest wind generating facility in the Eastern United States. The seven-turbine (Vestas V-66 turbines), 11.5 MW project is slated to be operational by September. Madison Windpower will connect to the Northeast power grid through the New York State Electric & Gas transmission system and the New York Independent System Operator (NY-ISO).
LEGAL & REGULATORY
Texas court finds Reliant HL&P guilty: A Houston jury ruled that Reliant HL&P acted with malice by intentionally underpaying cities for decades for the exclusive right to sell electricity in those cities. The state district court jury ordered HL&P to pay $4.2 million in actual damages to Pasadena, Galveston and Wharton. The verdict could cost HL&P substantially more because 50 cities, including Houston, are part of a class-action lawsuit accusing the utility of underpaying them by $113 million through accounting tricks. The judge decided to hear only the claims of three cities in the first trial, and he may apply the jury’s finding to the other cities’ claims.
LEGAL & REGULATORY
H Power Corp. files for IPO: H Power Corp., a developer of proton exchange membrane fuel cell systems, filed a registration statement with the Securities and Exchange Commission for an initial public offering of its common stock to be listed on the Nasdaq National Market under the symbol “HPOW.”
TradeOut.com builds utility team: The TradeOut.com surplus inventory marketplace is focusing efforts more directly on the utility industry. The company recently created a utility sales group, led by power industry veterans from companies such as World Energy, GE Power Systems, FP&L and Puget Sound Energy.
PowerTrust.com offers wireless discount: Internet retail energy supplier Power-Trust.com recently partnered with SimplyWireless.com to offer wireless telephone services, including a $40 discount on an AT&D Digital PCS phone.