For Immediate Release
For Immediate ReleaseMay 2, 2002
WASHINGTON, D.C.-The pending merger of Potomac Electric Power Company (Pepco)(NYSE: POM) and Conectiv (NYSE: CIV/CIVA) drew a step closer today with final approval from the District of Columbia Public Service Commission. Approvals by regulators in New Jersey and the U.S. Securities and Exchange Commission are all that remain before the two companies are combined.
"The commission`s action brings us to the final steps necessary to complete the merger process and provides additional benefits for our Washington customers by extending the current period of rate stability," said Dennis R. Wraase, Pepco president and chief operating officer.
The merger of Pepco, based in Washington, and Wilmington, Del.-based Conectiv 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 will continue operations as separate companies under a new corporate parent, Pepco Holdings, Inc., with headquarters in Washington.
The merger has received approval from the Federal Energy Regulatory Commission, and has cleared review by the Federal Trade Commission and the Department of Justice. Delaware, Maryland, Pennsylvania and Virginia previously approved the merger. A merger settlement agreement reached last month in New Jersey requires final consideration by the Board of Public Utilities.
Under the merger settlement in the District of Columbia, the current cap on Pepco`s distribution rates will be extended 30 months through Aug. 7, 2007. The company also agreed not to seek recovery of merger related costs and to contribute $2 million to support development and implementation of a small customer "smart meter" pilot program. Smart metering technology allows customers to more closely monitor their energy usage, enabling them to change usage patterns to their benefit.
Pepco (www.pepco.com) is an investor-owned company that delivers electricity to more than 700,000 customers in Washington, D.C. and the Maryland suburbs. Conectiv (www.conectiv.com) is focused on two core energy businesses. Conectiv Power Delivery provides energy to more than one million customers in N.J., Del., Md., and Va. Conectiv Energy manages a growing portfolio of "mid-merit" power plants that can respond quickly to changes in the demand for power with the PJM power pool.
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