For Immediate Release
For Immediate ReleaseMay 19, 2000
Potomac Electric Power Company (NYSE: POM) announced today that it will sell its 9.72 percent interest in the Conemaugh Generating Station to a joint bid by PPL Global, Inc., a subsidiary of PPL Corporation (NYSE: PPL) and Allegheny Energy Supply Company, LLC, a subsidiary of Allegheny Energy, Inc. (NYSE: AYE). The purchase price for Pepco's share is $152.5 million, which is more than twice net book value.
"The sale of our interest in the Conemaugh plant is an important step as we are in the process of divesting our generation assets and positioning the company to win in the competitive electricity markets that are emerging," said John Derrick, Chairman and Chief Executive Officer of Pepco.
Pepco's interest in the 1,711 megawatt (MW) Conemaugh plant, located in New Florence, Pa., totals
166 MW. The parties intend to close the deal later this year, pending regulatory approvals. While final adjustments will be made for fuel, inventories and selected other expenditures, the $152.5 million sales price grosses approximately $920 per kilowatt, which is near the top of the range for recent power plant sales.
"Conemaugh's access to both the Mid-Atlantic (PJM) and Midwest (ECAR) power pools and its status as an efficient, low-cost provider generated significant buyer interest," added Derrick. "The company decided to 'fast-track' the sale of its interest in Conemaugh because of the high levels of interest expressed by bidders for our facilities."
Final bids for the balance of Pepco's generation assets (approximately 5900 MW) are due at the end of May. The assets include four wholly-owned power plants in Maryland and Virginia, an engineering and maintenance service facility, five purchased power agreements, and certain facilities and management services.
Pepco has retained Navigant Consulting, Inc. to manage the divestiture of its generation portfolio, including the Conemaugh plant. Merrill Lynch is serving as Pepco's financial advisor, and the firm of Dickstein, Shapiro, Morin & Oshinsky is the company's legal advisor. Interested parties should contact John Dingle at 781-564-9746.
Pepco is an investor-owned utility that provides electricity in Washington, D.C. and the Maryland suburbs, serving more than 700,000 customers. Pepco, through its family of unregulated subsidiaries, also offers electric energy, natural gas, high-speed Internet access, local and long-distance telephone, cable television and energy management services in the Mid-Atlantic region.
PPL Global is the international and development arm of PPL Corp. that delivers electricity and natural gas to more than 1.3 million customers in Pennsylvania; markets wholesale or retail energy in 43 states and Canada; provides energy services for businesses in the Mid-Atlantic and Northeast United States; generates electricity at power plants in Pennsylvania, Maryland and Montana; delivers electricity to 1.4 million customers in Britain and to more than 800,000 customers in Chile, Bolivia and El Salvador.
Allegheny Energy, Inc. is a diversified energy company, headquartered in Hagerstown, Md. The Allegheny Energy family includes Allegheny Power, which delivers electric energy and natural gas to about three million people in parts of Maryland, Ohio, Pennsylvania, Virginia, and West Virginia; Allegheny Energy Supply Company, which operates and markets competitive retail and wholesale electric generation and operates regulated electric generation for its affiliates; and Allegheny Ventures, which actively invests in and develops energy-related and telecommunications projects.
Information contained in this press release may include forward-looking statements, which should be considered in light of the risks inherent in the company's business, as discussed in the company's public documents filed with the Securities and Exchange Commission.
Point of Contact:Robert Dobkin