[Federal Register Volume 59, Number 170 (Friday, September 2, 1994)]
[Notices]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-21704]


[[Page Unknown]]

[Federal Register: September 2, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26113; International Series Release No. 705]

 

Filings Under the Public Utility Holding Company Act of 1935 
(``Act'')

August 26, 1994.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated thereunder. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendment thereto is/are available for public 
inspection through the Commission's Office of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
application(s) and/or declaration(s) should submit their views in 
writing by September 19, 1994, to the Secretary, Securities and 
Exchange Commission, Washington, DC 20549, and serve a copy on the 
relevant applicant(s) and/or declarant(s) at the address(es) specified 
below. Proof of service (by affidavit or, in the case of an attorney at 
law, by certificate) should be filed with the request. Any request for 
hearing shall identify specifically the issues of fact or law that are 
disputed. A person who so requests will be notified of any hearing, if 
ordered, and will receive a copy of any notice or order issued in the 
matter. After said date, the application(s) and/or declaration(s), as 
filed or as amended, may be granted and/or permitted to become 
effective.
Entergy Corporation (70-8445)

    Entergy Corporation (``Entergy''), 225 Baronne Street New Orleans, 
Louisiana 70112, a registered holding company, has filed an 
application-declaration with the Commission under Sections 3(b), 6(a), 
7, 9(a), 10, 12(b), 32 and 33 of the Act and Rules 10, 43, 45, 53, and 
54.
    Entergy seeks exemptions from the Act in connection with the 
acquisition of the securities of one or more subsidiary companies 
(collectively, ``Subsidiary Companies'') which will be engaged directly 
or indirectly, and exclusively, in the business of owning and holding 
the securities of a new Argentine company (``Newco''). Newco will be 
formed to bid for the right to build, own and operate proposed high 
voltage transmission line (``Project'') in northeast Argentina. Entergy 
states that Newco would qualify as a ``foreign utility company'' under 
Section 33 of the Act. Therefore, Entergy requests that the Commission 
issue an order under Section 3(b) exempting the certain Subsidiary 
Companies from all provisions of the Act that would be applicable to 
such companies as ``subsidiary companies'' of Entergy. In the 
Alternative, Entergy proposes to acquire the securities of the 
Subsidiary Companies under all other applicable sections and rules 
thereunder of the Act.
    The Project is designed to carry electricity from the Yacyreta 
hydroelectric facility, now under construction, to the high voltage 
transmission system owned and operated by Transener S.A. Entergy 
Currently owns an indirect 9.8% interest in Transener S.A. through its 
wholly owned subsidiary company, Entergy Transener S.A., which is also 
a ``foreign utility company'' under Section 33 of the Act. The Project 
is expected to take up to 22 months to complete at a total cost of up 
to approximately U.S. $300 million. Entergy will be participating in 
the Project with a consortium of other U.S. and international investors 
(``Consortium'').
    Entergy contends that for various tax and legal reasons, it is 
preferable to hold its interest in Newco indirectly through the 
Subsidiary Companies. Entergy further asserts that the particular 
ownership structure to be used for the Project will depend on, among 
other things, the requirements of the documents relating to the bidding 
for the Project (``Bid Documents''). The Bid Documents currently 
require that the shareholders of Newco, collectively, have an aggregate 
net worth of at least $150 million. The terms of the Bid Documents 
further provide that, during the construction period for the Project, 
each shareholder of Newco is jointly and severally liable together with 
Newco for all obligations arising out of construction, including 
damages. In view of such requirements, as well as the possible 
requirements of Project lenders, Entergy proposes that it may fully or 
partially capitalize one or more of the Subsidiary Companies (but not 
newco) with amounts up to its proportionate share of the Project's 
estimated total cost either prior to the submission of the Cosortium's 
bid or to facilitate the financial closing of the Project. Entergy 
expects that its total investment in connection with the Project, 
including any contingent liabilities of a Subsidiary Company as a 
shareholder of Newco, would in no event exceed $90 million.
    Entergy proposes that within 45 days after a determination is made 
not to proceed with an acquisition of an interest in the Project, it 
will liquidate or dissolve the Subsidiary Companies, unless Entergy 
determines to utilize the Subsidiary Companies in conjunction with 
another exempt acquisition under Sections 32 or 33 of the Act. 
Therefore, Entergy requests authorization from the Commission to effect 
such a liquidation or dissolution.
    The direct or indirect investments in the Subsidiary Companies may 
take the form of: (1) purchases of capital stock, partnership 
interests, notes or other securities; (2) capital contributions or open 
account advances; (3) guarantees, letters of credit or other credit 
support (collectively, Guarantees'') arranged or provided by Entergy in 
respect of the securities or other obligations of a Subsidiary Company 
or Newco in connection with the Project; or (4) any combination of the 
above. Investments by Entergy in the capital shares or other equity 
securities of Subsidiary Companies having a stated or par value will be 
in an amount not less than such stated or par value. Open account 
advances by Entergy to a Subsidiary Company would be non-interest 
bearing and repayable within one year of the advance. Any promissory 
notes or other evidences of indebtedness issued by a Subsidiary Company 
to Entergy would: (1) mature not late than 30 years after the date of 
issuance thereof; and (2) bear interest at a rate not greater than the 
prime rate of a bank to be designated by Entergy. Any such promissory 
note or other evidences of indebtedness may, at Entergy's option, be 
converted to a capital contribution through Entergy's forgiveness of 
the indebtedness evidenced thereby.
    Entergy requests authority through December 31, 1997 to issue 
Guarantees in an aggregate amount that, when added to investments in 
the Subsidiary Companies and Newco otherwise made as provided above, 
will not exceed $90 million. Guarantees may be required, among other 
things, to satisfy credit support requirements of lenders and other 
Project participants under financing documents or other agreements to 
which the Subsidiary Companies or Newco becomes a party in connection 
with the development of the Project. The terms of, and any fees or 
interest payable in respect of, Guarantees will be established at arm's 
length based on market conditions; provided that (1) the term of any 
Guarantee would not exceed ten years from the date of issuance thereof, 
and (2) any fees with respect to any Guarantee would not exceed three 
percent per annum of the face amount of such Guarantee.
    Funds for Entergy's direct or indirect investments in the 
Subsidiary Companies and in Newco are expected to be derived from 
Entergy's available internal cash resources. Entergy also anticipates 
that the Subsidiary Companies will not engage in any financial from 
external sources in connection with the Project.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-21704 Filed 9-1-94; 8:45 am]
BILLING CODE 8010-01-M