[Federal Register Volume 59, Number 202 (Thursday, October 20, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-26057]


[[Page Unknown]]

[Federal Register: October 20, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26142]

 

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

October 14, 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 amendments 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 November 7, 1994, to the Secretary, Securities and Exchange 
Commission, Washington, D.C. 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 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.

General Utilities Corp. (70-8455)

    General Public Utilities Corporation (``GPU''), 100 Interpace 
Parkway, Parsippany, New Jersey, 07054, a registered holding company, 
has filed a declaration under Sections 6(a), 7, and 32 of the Act and 
Rules 53 and 54 thereunder.
    GPU proposes to issue and sell for cash from time to time through 
December 31, 1996 up to 5 million additional shares of common stock, 
par value $2.50 per share (``Additional Common Stock''). GPU would 
issue and sell the Additional Common Stock to the public from time to 
time either through (i) one or more negotiated transactions with one or 
more underwriters or (ii) one or more agents who regularly engage in 
the sale or placement of securities pursuant to an agreement, or (iii) 
a combination of the above.
    In addition, GPU might sell Additional Common Stock to an agent, as 
principal, for resale directly or indirectly to the public. It is 
anticipated that such sales would be made from time to time in one or 
more market transactions in the New York Stock Exchange or in regional 
exchanges in which GPU common stock might be traded, in block 
transactions in such exchanges or in fixed-price offers off the floor 
of such exchanges or other such special-type offers or distributions 
made in accordance with the rules of such exchanges.
    GPU has a total of 150 million authorized shares of common stock, 
of which 115,079,626 shares have been issued. In addition, GPU has 
10,703,712 reacquired shares. The Additional Common Stock would be sold 
either from authorized and unissued shares or reacquired shares.
    The issuance and sale of Additional Common Stock would not be 
subject to preemptive rights of present stockholders by virtue of 
Article 9(a) of the Articles of Incorporation for GPU, which provides 
no preemptive rights with respect to an issuance and sale of GPU common 
stock solely for money and through, inter alia, a public offering or an 
offering to or through underwriters or dealers.
    GPU will utilize the net proceeds of the sale of Additional Common 
Stock to make cash capital contributions, as authorized by Commission 
orders dated March 6, 1992 (HCAR No. 25486) and March 25, 1994 (HCAR 
No. 26011), to its electric public utility subsidiary companies--Jersey 
Central Power & Light Company, Metropolitan Edison Company and 
Pennsylvania Electric Company (``Subsidiaries''). The Subsidiaries will 
use such funds (i) to repay indebtedness, (ii) to redeem senior 
securities in accordance with the optional redemption provisions 
thereof, (iii) for construction, (iv) for other corporate purposes, or 
(v) to reimburse their treasuries for funds previously expended 
therefrom for such purposes. A portion of such net proceeds might also 
be used to reimburse GPU for funds previously expended to make capital 
contributions, to repay GPU indebtedness, and for other GPU corporate 
purposes, which include direct or indirect acquisition of interests in 
exempt wholesale generators and foreign utility companies.
    On June 30, 1994, the consolidated capitalization ratios of GPU 
were approximately 43.9% for Long-Term Debt, 5.4% for Preferred Stock, 
43.8% for Common Stock, and 6.9% for Short-Term Debt.
    The reported closing price of GPU common stock on the New York 
Stock Exchange Composite Tape on August 15, 1994 was $26.125 per share. 
If all of the Additional Common Stock were sold at that price, at June 
30, 1994, the consolidated capitalization ratios of GPU would be 
approximately 43.0% for Long-Term Debt; 5.2% for Preferred Stock; 45.0% 
for Common Stock; and 6.8% for Short-Term Debt. GPU has targeted a 
common equity ratio of between 45.0% and 48.0%.
    In the quarter that ended June 30, 1994, GPU wrote off (after tax) 
$191.6 million, or $1.66 per share, as a result of a decision by the 
Pennsylvania Commonwealth Court that disallowed the recovery from 
customers by Metropolitan Edison Company of certain future costs 
associated with Three Mile Island Unit No. 2 and restructuring charges 
associated with a GPU retirement program, and as a result of another 
Commonwealth Court decision that disallowed deferral of certain post-
retirement benefit costs.
    The effect of these write-offs will severely restrict the ability 
of Metropolitan Edison Company and Pennsylvania Electric Company to 
issue senior securities during the next twelve months. GPU believes 
that restoration of its equity capitalization, particularly in light of 
the emerging competitive business environment in the electric utility 
industry, is necessary in order to maintain the current credit ratings 
of the Subsidiaries.

Columbia Gas System, Inc., et al. (70-8471)

    Columbia Gas System, Inc. (``Columbia''), a registered holding 
company, and seventeen wholly-owned distribution, transmission, 
exploration and development, and other subsidiary companies,\1\ all of 
which are engaged in the natural gas business, have filed an 
application-declaration under Sections 6, 7, 9(a), 10, 12(b), 12(c), 
and 12(f) of the Act and Rules 42, 43, 45, and 46 thereunder.
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    \1\Columbia Gas of Pennsylvania, Inc. (``Columbia 
Pennsylvania''), 200 Civic Center Drive, Columbus, Ohio 43215; 
Columbia Gas of Ohio, Inc. (``Columbia Ohio''), 200 Civic Center 
Drive, Columbus, Ohio 43215; Columbia Gas of Maryland, Inc. 
(``Columbia Maryland''), 200 Civic Center Drive, Columbus, Ohio 
43215; Columbia Gas of Kentucky, Inc. (``Columbia Kentucky''), 200 
Civic Center Drive, Columbus, Ohio 43215; Commonwealth Gas Services, 
Inc. (``Commonwealth Services''), 200 Civic Center Drive, Columbus, 
Ohio 43215; Columbia Gulf Transmission Co. (``Columbia Gulf''), 1700 
MacCorkle Avenue, S.E., Charleston, West Virginia 25314; Columbia 
Gas Development Corp. (``Columbia Development''), One Riverway, 
Houston, Texas 77056; Columbia Natural Resources, Inc. (``Columbia 
Resources''), 900 Pennsylvania Avenue, Charleston, West Virginia 
25302; Columbia Coal Gasification Corp. (``Columbia Coal''), 900 
Pennsylvania Avenue, Charleston, West Virginia 25302; Columbia 
Energy Services Corp. (``Columbia Services''), 2581 Washington Road, 
Upper Saint Clair, Pennsylvania 15241; Columbia Gas System Service 
Corp. (``Service Corporation''), 20 Monchanin Road, Wilmington, 
Delaware 19807; Columbia Propane Corp. (``Columbia Propane''), 800 
Moorefield Park Drive, Richmond, Virginia 23236; Commonwealth 
Propane, Inc. (``Commonwealth Propane''), 800 Moorefield Park Drive, 
Richmond, Virginia 23236; TriStar Ventures Corp. (``TriStar 
Ventures''), 20 Monchanin Road, Wilmington Delaware 19807; TriStar 
Capital Corp. (``TriStar Capital''), 20 Monchanin Road, Wilmington 
Delaware 19807; Columbia Atlantic Trading Corp. (``Columbia 
Atlantic''), 20 Monchanin Road, Wilmington Delaware 19807; and 
Columbia LNG Corp. (``Columbia LNG''), 20 Monchanin Road, Wilmington 
Delaware 19807.
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    Columbia, and fourteen of the subsidiary companies 
(``Subsidiaries''),\2\ seek Commission authorization for the 
recapitalization of Columbia Gulf, Columbia Development, and Columbia 
Coal (``Recapitalization Subsidiaries''), the 1995 and 1996 Long-Term 
and Short-Term Financing Programs of the Subsidiaries, and continuation 
of the Intrasystem Money Pool (``Money Pool'') through 1996.
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    \2\Columbia Pennsylvania, Columbia Ohio, Columbia Maryland, 
Columbia Kentucky, Commonwealth Services, Columbia Gulf, Columbia 
Development, Columbia Resources, Columbia Coal, Service Corporation, 
Columbia Propane, Commonwealth Propane, TriStar Capital, and 
Columbia Atlantic.
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    Prior to July 31, 1991, almost all external financing for Columbia 
and the Subsidiaries (``System'') had been through public equity and 
debt offerings, short-term borrowings from banks, and sales of 
commercial paper. The proceeds were provided to the Subsidiaries on 
comparable terms through purchases of debt or equity, through open-
account advances, or through the Money Pool.
    Columbia and Columbia Gas Transmission Corporation (``Columbia 
Transmission''), in consequence of significant financial difficulties 
related to the purchase of high-cost gas under long-term contracts, 
sought protection under Chapter 11 of the U.S. Bankruptcy Code 
(``Code'') in July 1991. Thereafter, Columbia negotiated debtor-in-
possession (``DIP'') financing in order to fund the operations of its 
subsidiaries besides Columbia Transmission. Columbia Transmission 
negotiated its own DIP financing.
    An order that approved a $275 million Secured Revolving Credit 
Facility for Columbia (``DIP Facility'') was granted by the U.S. 
Bankruptcy Court for the District of Delaware (``Bankruptcy Court'') in 
September 1991. The Commission approved the DIP Facility by order dated 
September 21, 1991 (HCAR No. 25380). Orders approving amendments to the 
DIP Facility, which improved its terms and reduced its available amount 
to $100 million, were granted by the Bankruptcy Court in May 1993 and 
in August 1994. The Commission approved the amendments by orders dated 
June 11, 1993 (HCAR No. 25828) and September 12, 1994 (HCAR No. 26120).
    Columbia and the Recapitalization Subsidiaries seek Commission 
authorization for the recapitalization of Columbia Gulf, Columbia 
Development and Columbia Coal on or about December 31, 1994 to 
establish capital structures that are more appropriate for current 
business and economic conditions. The proposed transactions and the 
goals for the Recapitalization Subsidiaries were approved by the 
Bankruptcy Court in July 1994.
    With respect to Columbia Gulf, the goal is to bring its long-term 
debt-equity ratio to 45/55. It is proposed to (i) issue Installment 
Promissory Notes (``Installment Notes'') of up to $67 million to 
Columbia for cash; (ii) reduce the par value of its common stock from 
$25 per share to $10 per share (in order to create approximately $90 
million in additional paid in capital; and (iii) pay a dividend of up 
to $67 million to Columbia out of surplus. The dividend would 
approximate the dollar amount of Installment Notes issued. It is stated 
that the proposed increase in the debt service of Columbia Gulf can be 
supported from cash flow from its operations.
    With respect to Columbia Development, the goal is to bring its 
long-term debt-equity ratio to 40/60. It is proposed for Columbia to 
make a tax-free capital contribution of up to $62 million of 
Installment Notes previously issued by Columbia Development and held by 
Columbia. The transaction proposed would be similar to that approved by 
the Commission by order dated December 11, 1992 (HCAR No. 25703).
    With respect to Columbia Coal, the goal is to bring its long-term 
debt-equity ratio to 40/60. It is proposed that Columbia make a tax-
free capital contribution of up to $12 million of Installment Notes 
previously issued by Columbia Coal and held by Columbia.
    Sources of funds for the Subsidiaries will include their internal 
cash flow and Money Pool borrowings. No external sources are projected 
to be needed to fund their 1995 and 1996 financing programs while 
Columbia remains in bankruptcy.
    The Subsidiaries plan to finance part of their capital expenditure 
programs with funds generated from internal sources and through short-
term borrowings from the Money Pool, to the extent Columbia 
subsidiaries have temporary excess funds, or from the sale to Columbia, 
for cash, of common stock at par value and Installment Notes up to the 
specified amounts (in million $$):

------------------------------------------------------------------------
                                                Stock    Notes    Total 
------------------------------------------------------------------------
Columbia Kentucky............................      2.0     12.7     14.7
Columbia Maryland............................      3.0      5.5      8.5
Columbia Ohio................................     44.0     91.8    135.8
Columbia Pennsylvania........................     16.5     33.6     50.1
Commonwealth Services........................     26.0     16.2     42.2
Columbia Resources...........................  .......     50.0     50.0
Columbia Development.........................     25.0     25.0     50.0
Commonwealth Propane.........................  .......      4.5      4.5
Columbia Gulf................................  .......     13.0     13.0
Service Corporation..........................     10.0      5.0     15.0
TriStar Capital..............................      0.1  .......      0.1
                                              --------------------------
    Total....................................    126.6    257.3    383.9
------------------------------------------------------------------------

    These amounts allow for contingencies such as higher gas prices, 
warm weather, amounts of projected tax refunds, amounts of rate refunds 
and the variability of capital expenditure programs. To the extent that 
such contingencies do not materialize, the requested financing 
authorizations will not be fully utilized.
    The Installment Notes will be unsecured and will be dated the date 
of their issue. It is proposed that the interest rate on the 
Installment Notes will be determined quarterly based upon the three-
month average yield on newly issued ``A'' rated 25-30 year utility 
bonds, per the weekly Bond Market Roundup published by Salomon 
Brothers, rounded to the nearest \1/8\% per annum (``Benchmark Rate''). 
The Benchmark Rate would be used for all Installment Notes issued in 
the subsequent quarter. The Benchmark Rate was approved by the 
Commission by order dated September 30, 1994 (HCAR No. 26062) (``1993 
Order'').
    It is proposed that a default rate equal to 2% per annum in excess 
of the stated rate on unpaid principal or interest amounts would be 
assessed if any interest or principal payment becomes past due. The 
principal amount of the Installment Notes will be repaid over a term 
not in excess of thirty years. All of the Installment Notes will be 
purchased by Columbia on or before December 31, 1996.
    The Subsidiaries require short-term funds to meet normal capital 
requirements. It is proposed that the Subsidiaries borrow short-term 
funds from the Money Pool in amounts specified below (in million $$):

Columbia Kentucky.............................................      19.0
Columbia Maryland.............................................       4.0
Columbia Ohio.................................................     240.0
Columbia Pennsylvania.........................................      88.0
Commonwealth Services.........................................      19.0
Columbia Gulf.................................................      19.0
Columbia Resources............................................      30.0
Columbia Development..........................................      15.0
Columbia Propane..............................................       2.0
Commonwealth Propane..........................................       4.0
Service Corporation...........................................      10.0
Columbia Coal.................................................       2.0
                                                               ---------
    Total.....................................................     452.0
                                                                        

    Advances from the Money Pool will be limited to a maximum amount 
outstanding at any one time from January 1, 1995 through December 31, 
1996. It is proposed that the Money Pool, which was last approved by 
the Commission in the 1993 Order, be continued through December 31, 
1996. All short-term borrowing will be through the Money Pool, with the 
Service Corporation as agent. Columbia may invest in the Money Pool but 
will not borrow from the Money Pool.
    When Columbia and the subsidiaries generate cash in excess of their 
immediate cash requirements, such temporary excess cash may be invested 
in the Money Pool. Columbia and investing subsidiaries would be 
investors (``Investors'') pursuant to a Money Pool evidence of a 
deposit. Loans to the Subsidiaries (``Borrowers'') through the Money 
Pool will be made pursuant to a short-term grid note. Such short-term 
grid notes will be due upon demand by the Investors but not later than 
April 30, 1997. The loans will be allocated to the Investors based on 
the proportion of their relative investment in the Money Pool.
    The cost of money on all short-term advances from, and the 
investment rate for funds invested in, the Money Pool will be the 
interest rate per annum equal to its weighted average short-term 
investment rate. Should there be no Money Pool investments, the cost of 
money will be the average Federal Funds rate for the prior month 
published in the Federal Reserve Statistical Release. A default rate 
equal to 2% per annum above the pre-default rate on unpaid principal or 
interest amounts will be assessed if any interest or principal payment 
becomes past due.

CINergy Corp. (70-8477)

    CINergy Corp. (``CINergy''), 139 East Fourth Street, Cincinnati, 
Ohio 45202, a Delaware corporation not currently subject to the Act, 
has filed a declaration under sections 6(a), 7, and 12(b) of the Act 
and rules 45 and 54 thereunder.
    CINergy seeks authorization to issue and sell up to eight million 
shares of its common stock, par value .01, in one or more issuances, 
from time to time, prior to December 31, 1995 following the proposed 
combination of Cincinnati Gas & Electric Company (``CG&E'') and PSI 
Resources, Inc. (``PSI'') and the registration of CINergy as a holding 
company. The proposed combination of CG&E and PSI is currently before 
the Commission in file number 70-8427. CINergy is requesting 
authorization in the event that a contemplated issuance of eight 
million shares of PSI common stock is not consummated prior to the 
proposed merger of CG&E and PSI. CINergy proposes to sell the shares in 
one of four ways: (1) through the solicitation of proposals of 
underwriters or dealers; (2) through underwriters or dealers on a 
negotiated basis; (3) directly to a limited number of purchasers or to 
a single purchaser; or (4) through agents.
    In addition, CINergy requests authority to contribute up to $160 
million of the net proceeds from the sale of such shares to the equity 
capital of its then electric public-utility subsidiary company, PSI 
Energy, Inc. (``PSI Energy''). CINergy states that PSI Energy would use 
the funds for general corporate purposes, including the repayment of 
short-term indebtedness incurred for construction financing.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-26057 Filed 10-19-94; 8:45 am]
BILLING CODE 8010-01-M