For Immediate Release
For Immediate ReleaseApril 16, 2002
Potomac Electric Power Company (Pepco)(NYSE: POM) and Wilmington, Del.based -- Conectiv (NYSE : CIV/CIVA) today announced that a merger settlement agreement has been reached in New Jersey, one of the few remaining jurisdictions whose approval is necessary before the two companies are combined. The settlement was signed by the other key parties in New Jersey, including Staff of the New Jersey Board of Public Utilities, New Jersey Ratepayer Advocate`s office, Independent Energy Producers of New Jersey, New Power Company, a competitive power supplier, and both utilities.
Key elements of the settlement include a $1 million contribution to be used to assist schools in Conectiv`s South Jersey service territory, customer service guarantees and a reduction of $30.5 million in Conectiv`s "deferral balance." The deferral is designed to allow future recovery of certain costs associated with electric industry restructuring and is unique to New Jersey. The companies also agreed to absorb merger-related expenses.
The signed settlement agreement will be submitted to the Administrative Law Judge in the case. After a period of comment, the Judge`s decision will be submitted to the New Jersey Board of Public Utilities for final consideration.
"The New Jersey settlement is an important step to gaining the approvals necessary to complete the merger," said Tom Shaw, Conectiv`s President. Shaw said, "As a result of the settlement, rates for our New Jersey customers will be lower than they otherwise would have been." The merger has received approval from the Federal Energy Regulatory Commission, and has cleared review by the Federal Trade Commission and U.S. Department of Justice. Virginia, Pennsylvania, Maryland and Delaware previously approved the merger. In addition to a final approval from New Jersey, approvals are pending from the U.S. Securities and Exchange Commission and from regulators in the District of Columbia, where a unanimous settlement agreement was reached earlier.
The merger will create the largest electricity delivery company in the mid-Atlantic region with a transmission network serving 1.8 million customers in a 10,000-square-mile area. The two utilities, however, will continue as separate operating companies.
About PepcoPepco is an investor owned company that delivers electricity to more than 700,000 customers in Washington, D.C. and the Maryland suburbs. Through its family of subsidiaries, Pepco also operates in the competitive arena of telecommunications and energy products and services in the mid-Atlantic region. For more information visit the company`s web site at www.pepco.com.
About ConectivConectiv, a Fortune 500 company headquartered in Wilmington, Del., is focused on two core energy businesses. Conectiv Power Delivery provides energy to more than one million customers in New Jersey, Delaware, Maryland and Virginia. Conectiv Energy uses a sophisticated power-trading unit to optimize the value of a growing portfolio of mid-merit power plants that can start and stop quickly in response to changes in the demand for power within the PJM power pool. For more information, visit the company`s web site at www.conectiv.com.
FORWARD-LOOKING STATEMENTS:Except for historical statements and discussions, the statements in this press release constitute "forward-looking statements" within the meaning of the federal securities laws. These statements contain managements` beliefs based on information currently available to them and on various assumptions concerning future events. Forward-looking statements are not a guarantee of future performance or events. They are subject to a number of uncertainties and other factors, many of which are outside the companies` control. In connection with the transaction, additional important factors that could cause actual results to differ materially from those in the forward-looking statements herein include risks and uncertainties relating to delays in obtaining or adverse conditions contained in, related regulatory approvals, changes in economic conditions, availability and cost of capital, changes in weather patterns, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines and other presently unknown or unforeseen factors. These uncertainties and factors could cause actual results to differ materially from such statements. The companies disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This information is presented solely to provide additional information to further understand the results and prospects of the companies.
Point of Contact:Bob Dobkin