[Federal Register Volume 60, Number 222 (Friday, November 17, 1995)]
[Notices]
[Pages 57739-57743]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-28398]



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[[Page 57740]]


SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26406]


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

November 9, 1995.
    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 December 4, 1995, 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 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.

CSW Credit, Inc., et al. (70-7113/70-7218)

    CSW Credit, Inc. (``CSW Credit''), a nonutility subsidiary of 
Central and South West Corporation (``CSW''), a registered holding 
company, and CSW, both of 1616 Woodall Rodgers Freeway, Dallas, Texas 
75202, have filed a post-effective amendment to their application-
declaration filed under sections 6(a), 7, 9(a), 10 and 12(b) of the Act 
and rules 45 and 54 thereunder.
    By order dated July 19, 1985 (HCAR No. 23767) (``1985 Order''), CSW 
was authorized, among other things, to organize CSW Credit to purchase 
the accounts receivable of the operating companies of CSW at a discount 
and to finance these purchases with the issuance and sale of debt. CSW 
Credit was authorized to borrow up to $320 million and CSW was 
authorized to make equity investments in CSW Credit of up to an 
aggregate of $80 million through December 31, 1986.
    By order dated July 31, 1986 (HCAR No. 24157) (``1986 Order''), CSW 
Credit was authorized to expand its business to the factoring of 
accounts receivable of nonaffiliated electric utility companies. In 
order to finance such transactions, CSW Credit was authorized to borrow 
up to an additional $160 million and CSW was authorized to make 
additional equity investments in CSW Credit of up to an aggregate of 
$40 million, through December 31, 1988. The 1986 Order also required 
CSW Credit to limit its acquisition of utility receivables from 
nonassociate utilities so that the average amount of such receivables 
for the preceding twelve-month period outstanding as of the end of any 
calendar month would be less than the average amount of receivables 
acquired from CSW associate companies outstanding as of the end of each 
calendar month during the preceding twelve-month period (``50% 
Restriction''). Further, the 1986 Order extended the authority of the 
1985 Order until December 31, 1988.
    By order dated February 8, 1988 (HCAR No. 24575), CSW Credit was 
authorized, among other things, to borrow, through December 31, 1989, 
up to $320 million and $304 million to finance the factoring of 
affiliate and nonaffiliate receivables, respectively. CSW was 
authorized to make equity investments in CSW Credit of up to an 
aggregate of $80 million and $76 million in connection with the 
factoring of affiliate and nonaffiliate receivables, respectively. This 
authority was extended through December 31, 1990 by order dated 
December 27, 1989 (HCAR No. 25009).
    By order dated August 30, 1990 (HCAR No. 25138), CSW Credit was 
authorized to lower its equity ration to no less than 5%.
    By orders dated December 21, 1990 and December 24, 1991 (``1991 
Order''), December 9, 1992, December 21, 1993 and December 16, 1994 
(HCAR Nos. 25228, 25443, 25698, 25959, and 26190, respectively), CSW 
Credit's existing authority was extended through December 31, 1991, 
December 31, 1992, December 31, 1993, December 31, 1994 and December 
31, 1995, respectively. In addition, the 1991 Order granted CSW Credit 
the authorization to borrow up to an additional $200 million to finance 
the factoring of associate receivables.
    Pursuant to the orders summarized above, the following authority 
has been granted: (1) CSW Credit has been authorized to borrow $824 
million, of which $520 million could be used to purchase receivables of 
affiliated companies and $304 million could be used to purchase 
receivables of nonaffiliated companies; and (2) CSW has been authorized 
to make equity investments in CSW Credit of up to an aggregate of $156 
million, of which $80 million could be used to purchase receivables of 
affiliated companies and $76 million could be used to purchase 
receivables of nonaffiliated companies.
    For the twelve months ended September 30, 1995, CSW Credit had 
average outstanding receivables purchased from affiliated companies of 
$376 million and from nonaffiliated companies of $31 million. The 
outstanding receivable purchases from nonaffiliated companies do not 
include the $335 million average receivable purchases for the 12 months 
ended September 30, 1995 from Houston Lighting and Power Company, 
authorized by order dated December 29, 1992 (HCAR No. 25720). As of 
September 30, 1995, the amount of remaining authority, including debt 
and equity, that CSW Credit had available to purchase receivables from 
affiliated and nonaffiliated companies was $224 million and $349 
million, respectively.
    CSW Credit and CSW now propose to extend the previously granted 
authorities through December 31, 1996.

New England Electric System, et al. (70-8675)

    New England Electric System (``NEES''), a registered holding 
company, and two of its wholly-owned utility subsidiaries, 
Massachusetts Electric Company (``MEC'') and New England Electric Power 
Company (``NEP''), each located at 25 Research Drive, Westborough, 
Massachusetts 01582, have filed an application-declaration under 
sections 6(a), 7, 9(a), 10, 12(b), 12(c), and rules 43 and 45 
thereunder.
    Nantucket Electric Company (``NEC'') is a non-affiliated 
corporation engaged in generating, transmitting and distributing 
electric power to approximately 8,600 customers on the island of 
Nantucket, Massachusetts. NEC is not currently connected to the 
mainland in order to receive electric power. NEES and NEC have agreed 
that NEES will acquire NEC for NEES's common shares based on a purchase 
price of $125 per share or $3.5 million, plus interest that will accrue 
on the total purchase price from March 22, 1995 until the date of 
closing. The interest rate on this amount will not exceed the Bank of 
Boston prime rate. The amount of interest owed will be reduced by an 
amount to offset dividends payable to NEC shareholders that accrued 
before the date the sale is consummated.
    The acquisition is proposed to be accomplished through an exchange 
of 

[[Page 57741]]
NEES common shares for the 28,000 shares of outstanding common stock of 
NEC. The NEC common stock is $25 par value voting stock and comprises 
one class. To facilitate this transaction, NEES proposes to form a 
wholly-owned subsidiary (``Newsub''), which will be merged into NEC, 
with the surviving corporation (``Newco'') having all the rights, 
interests and obligations of NEC. Shares of Newsub will be converted 
into shares of new common stock of Newco, making Newco a wholly-owned 
subsidiary of NEES. Finally, NEC stockholders will receive NEES shares 
equivalent to $125 per NEC common share outstanding, adjusted by the 
interest payment and accrued dividend offset described above. At a 
current price of $34 per share, NEES would have to issue approximately 
103,000 shares to consummate the transaction, not taking the above-
described interest payment and accrued dividend offset into account.
    To finance the construction of an undersea cable and related 
facilities to be used by NEP to sell power to Newco, Newco will borrow 
from Massachusetts Industrial Finance Authority (``MIFA'') up to $28 
million (``Facilities Loan'') through the use of tax-exempt bond 
financing. Newco will be operated as though it were a part of MEC and 
to provide assurances to MIFA, MEC has agreed to enter into a Credit 
and Operating Support Agreement with Newco (``Support Agreement'') in 
order to provide additional revenues to Newco to cover its cost of 
service, including a return on common equity. NEES requests authority 
for Newco to assign its rights under the Support Agreement to MIFA as 
collateral for the Facilities Loan. Additionally, MEC requests 
authority to guarantee to MIFA Newco's obligations under the Facilities 
Loan. The Facilities Loan would mature in no more than forty years and 
bear an interest rate not to exceed ten percent per annum.
    NEES also requests authority through October 31, 1997 for Newco to 
make short term borrowings from banks, and to borrow from and lend to 
the NEES system money pool (``Money Pool''), up to an aggregate 
principal amount of $5,000,000. The terms of Newco's participation in 
the Money Pool shall conform to the terms and conditions of the Money 
Pool. The proposed borrowings from banks will be evidenced by notes 
maturing in less than one year and bear an interest rate not to exceed 
100 basis points over the greater of such bank's base or prime rate or 
the federal funds rate.

Southern Development and Investment Group, Inc. (70-8715)

    Southern Development and Investment Group (``Development''), a 
wholly-owned nonutility subsidiary of The Southern Company, a 
registered holding company, both of 64 Perimeter Center East, Atlanta, 
Georgia 30346, has failed an application-declaration under sections 
9(a) and 10 of the Act and rules 51 and 54 thereunder.
    By order dated January 25, 1995 (HCAR No. 26221), the Commission 
authorized Development to engage in, among other activities, the 
preliminary investigation and study of new business ventures or 
investment opportunities, including business opportunities using new 
communications technologies and related facilities; energy and demand 
side management services to customers both within the Southern system 
service territory; \1\ and the development, construction and operation 
of a prototype energy management communications network to use two-way, 
interactive customer-utility communications in connection with utility- 
and nonutility-related activities.

    \1\ Southern provides retail and wholesale electric service 
throughout Georgia, most of Alabama and parts of Florida and 
Mississippi.
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    Development now requests authorization, pursuant to a Stock 
Purchase Agreement (``Purchase Agreement''), to acquire 250,000 shares, 
approximately 3%, of authorized but unissued common stock of ITC 
Holding Co., Inc. (``ITC''), a telecommunications holding company. ITC, 
through various subsidiaries, provides local telephone exchange, toll, 
cellular and teleconferencing services, and sells related products, 
primarily in the southeastern United States.
    Specifically, ITC wholly owns Telecommunications Operations Group, 
which through its wholly-owned Interstate Telephone Co. and Valley 
Telephone Co., offers local telephone exchange services and related 
products, and InterCall, which provides audio-conferencing services 
primarily for businesses for sales meetings, board meetings, training 
sessions, investor relations and other multi-party communication. ITC 
also holds partial ownership interests in InterCel, which provides 
cellular telephone services in Georgia, Alabama and Maine; Interstate 
Fibernet Co., a wholesale transmission carrier that owns and operates a 
regional optical fiber transmission network in Mississippi, Alabama, 
Georgia, Louisiana, North Carolina, and South Carolina (its optical 
power ground wire is located along power companies transmission right 
of way--a portion of which is being constructed along certain Southern 
System Operating Companies' rights of way); and InterServ Services 
Corp., which provides outsourced customer services and business to 
business telemarketing services. A unit of InterServ provides customer 
satisfaction survey information to some Southern operating companies. 
ITC also holds minority interests in companies engaged in fiber, 
wireless cable television, caller i.d. equipment marketing, and other 
telecommunications related operations.
    ITC and certain subsidiaries of Southern have previously entered 
into agreements under which portions of the optical fiber transmission 
network of an ITC subsidiary have been installed along the operating 
companies' utility right-of-way. Development and ITC have also engaged 
in discussions concerning possible joint development and 
experimentation with respect to the modernization of telecommunications 
in the southeastern United States, particularly with respect to the 
types of utility and utility-related communications services that 
Development is authorized to provide under the terms of the 
Commission's January 1995 Order, including but not limited to energy 
and demand-side management services and the build-out of communications 
network in various locations inside the Southern service territory to 
be used for such purposes.
    Development states that its investment in ITC will enable it to 
have input into the strategic planning of a major regional 
telecommunications provider as it formulates plans for investment in 
the modernization of communications infrastructure, much of which will 
be in Southern's service area. Development also asserts that its 
investment in ITC will provide ITC with the informed insight of a major 
customer of ITC, thereby enabling it to address the communications 
needs of Southern's subsidiaries.
    Under the Purchase Agreement, the purchase price for ITC's shares 
is $6,195,000, provided that if the closing has not occurred by January 
25, 1996, the purchase price will bear interest at 8.75% per annum, 
starting from that date until closing. Southern will make a cash 
capital contribution to Development of approximately $7,000,000 to fund 
the purchase and pay other costs associated with the transaction. 
Southern will obtain the funds from sales of common stock, as 
authorized by the Commission in orders dated August 2 and 3, 1995 (HCAR 
Nos. 26347 and 26349, respectively), from borrowings, and/or issuance 
of commercial paper, as authorized by the 

[[Page 57742]]
Commission in an order dated August 1, 1995 (HCAR No. 26346), and from 
available cash, chiefly dividends from subsidiaries.
    Under the Purchase Agreement, ITC will be obligated to use its best 
efforts for a period of three years to cause the election to the board 
of directors of ITC of a nominee of Development. Development states 
that neither it nor any associate company will, as a result of the 
ownership of the shares to be acquired and participation on ITC's board 
have the ability to control or dictate any corporate decisions or 
policies of ITC. In this regard, Development represents that ITC is a 
privately-held company that is controlled by its founder and chief 
executive officer and related family interest and certain other 
executive officers of the company.

Mississippi Power & Light Company (70-8719)

    Mississippi Power & Light Company (``MP&L''), 308 East Pearl 
Street, Jackson, Mississippi 39201, an electric utility subsidiary of 
Entergy Corporation, a registered holding company, has filed an 
application-declaration under sections 6(a), 7, 9(a), 10, 12(b), 12(c), 
12(d) and 12(e) of the Act and rules 44, 54, 62 and 65 thereunder.
    MP&L seeks authorization to issue and sell not more than $530 
million principal amount of (a) its general and refunding mortgage 
bonds (``Bonds'') and (b) its debentures (``Debentures''), issued in 
one or more new series from time to time through December 31, 2000. 
Each series of Bonds and/or Debentures will be sold at such price, will 
bear interest at such rate, either fixed or adjustable, and will mature 
on such date as will be determined at the time of sale. One or more 
series of Bonds and/or Debentures may include provisions for redemption 
or retirement prior to maturity, including restrictions on optional 
redemption for a given number of years.
    MP&L further proposes to issue and sell, from time to time through 
December 31, 2000, (a) one or more new series of the preferred 
securities of a subsidiary of MP&L (``Entity Interests'') and (b) one 
or more new series of its preferred stock (``Preferred''), in a 
combined aggregate amount not to exceed $75 million. Each series of 
Entity Interests will have a stated per share liquidation preference 
and will be sold at such price and will be entitled to receive 
distributions at such rate, either fixed or adjustable, on such 
periodic basis as will be determined, along with the maturity, at the 
time of sale. One or more series of Entity Interests may include 
provisions for redemption or retirement prior to maturity, including 
restrictions on optional redemption for a given number of years. The 
price, exclusive of accumulated dividends, and the dividend rate for 
each series of Preferred will be determined at the time of sale. MP&L 
may determine that the terms of the Preferred should provide for an 
adjustable dividend rate thereon to be determined on a periodic basis, 
subject to specified maximum and minimum rates, rather than a fixed 
dividend rate. The terms of one or more series of the Preferred may 
include provisions for redemption, including restrictions on optional 
redemption, and/or a sinking fund designed to redeem all outstanding 
shares of such series not later than forty years after the date of 
original issuance. Depending upon market conditions, MP&L may sell one 
or more series of Preferred to underwriters for deposit with a bank or 
trust company (``Depositary''). The underwriters would then receive 
from the Depositary and deliver to the repurchasers in the subsequent 
public offering shares of depositary preferred stock (``Depositary 
Preferred''), each representing a stated fraction of a share of the new 
series of Preferred. Depositary Preferred would be evidenced by 
depositary receipts. Each owner of Depositary Preferred would be 
entitled proportionally to all the rights and preferences of the series 
of Preferred (including dividends, redemption and voting). A holder of 
Depositary Preferred will be entitled to surrender Depositary Preferred 
to the Depositary and receive the number of whole shares of Preferred 
represented thereby. A holder of Preferred will be entitled to 
surrender shares of Preferred to the Depositary and receive a 
proportional amount of Depositary Preferred.
    MP&L may determine to amend its Restated Articles of Incorporation, 
as amended (``Articles''), to establish a new class of preferred stock 
having no par value or a nominal par value. It is expected that such 
class would rank pari passu with MP&L's existing class of preferred 
stock and would be identical with such class, except as to par value, 
variations among series, and voting entitlement in certain cases. In 
connection with any such amendment to the Articles, certain other 
amendments to the Articles unrelated to the new class of preferred 
stock, including, but not limited to, an amendment to increase the 
number of authorized shares of MP&L's existing class of preferred stock 
and/or amendments to clarify certain provisions with respect to 
issuance of preferred stock with market-based dividend rates and 
varying dividend payment periods, may also be adopted. Approval of 
outstanding stockholders of MP&L would be required to effect such an 
amendment to the Articles. In connection with such an amendment, MP&L 
would thus solicit proxies from holders of its outstanding Preferred 
and seek the consent of Entergy Corporation, the sole holder of its 
common stock.
    MP&L proposes to use the net proceeds derived from the issuance and 
sale of Bonds and/or the Debentures and/or the Entity Interests and/or 
the Preferred for general corporate purposes, including, but not 
limited to, the possible acquisition of certain outstanding securities.
    MP&L states that it presently contemplates selling the Bonds, 
Debentures, Entity Interests and Preferred either by competitive 
bidding, negotiated public offering or private placement.
    MP&L also proposes to enter into arrangements to finance on a tax-
exempt basis certain solid waste, sewage disposal and/or pollution 
control facilities (``Facilities''). MP&L proposes, from time to time 
through December 31, 2000, to enter into one or more leases, subleases, 
installment sale agreements, refunding agreements or other agreements 
and/or supplements and/or amendments thereto (each and all of the 
foregoing being referred to herein as the ``Agreement'') with one or 
more issuing governmental authorities (individually and collectively 
being referred to herein as the ``Authority''), pursuant to which the 
Authority may issue one or more series of tax-exempt revenue bonds 
(``Tax-Exempt Bonds'') in an aggregate principal amount not to exceed 
$35 million. The net proceeds from the sale of Tax-Exempt Bonds will be 
deposited by the Authority with the trustee (``Trustee'') under one or 
more indentures (``Indenture'') and will be applied by the Trustee to 
reimburse the Company for, or to permanently finance on a tax-exempt 
basis, the costs of the acquisition, construction, installation or 
equipping of the Facilities.
    MP&L further proposes, under the Agreement, to purchase, acquire, 
construct and install the Facilities unless the Facilities are already 
in operation. Pursuant to the Agreement, MP&L will be obligated to make 
payments sufficient to pay the principal or redemption price of, the 
premium, if any, and the interest on Tax-Exempt Bonds as the same 
become due and payable. Under the Agreement, MP&L 

[[Page 57743]]
will also be obligated to pay certain fees incurred in the 
transactions.
    The price to be paid to the Authority for each series of Tax-Exempt 
Bonds and the interest rate applicable thereto will be determined at 
the time of sale. The Agreement and the Indenture will provide for 
either a fixed interest rate or an adjustable interest rate for each 
series of Tax-Exempt Bonds. Each series may be subject to optional and 
mandatory redemption and/or a mandatory cash sinking fund under which 
stated portions of such series would be retired at stated times.
    In order to obtain a more favorable rating and thereby improve the 
marketability of the Tax-Exempt Bonds, MP&L may (1) Arrange for one or 
more letters of credit from one or more banks (collectively, ``Bank'') 
in favor of the Trustee (in connection therewith, MP&L may enter into a 
Reimbursement Agreement pursuant to which MP&L would agree to reimburse 
the Bank for amounts drawn under the letters of credit and to pay 
commitment and/or letter of credit fees), (2) provide an insurance 
policy for the payment of the principal, premium, if any, interest and 
purchase obligations in connection with one or more series of Tax-
Exempt Bonds, or (3) obtain authentication of one or more new series of 
Bonds (``Collateral Bonds'') to be issued under MP&L's General and 
Refunding Mortgage on the basis of unfunded net property additions and/
or previously retired First Mortgage Bonds or General and Refunding 
Mortgage Bonds and delivered and pledged to the Trustee and/or the Bank 
to evidence and secure MP&L's obligations under the Agreement and/or 
the Reimbursement Agreement. In addition, MP&L may grant to the 
Authority, the Bank or the Trustee a lien, subordinate to the liens of 
MP&L's First Mortgage and General and Refunding Mortgage, on the 
Facilities.
    MP&L also proposes to acquire, through tender offers or otherwise, 
certain of its outstanding securities, including its outstanding first 
mortgage bonds, its general and refunding mortgage bonds, its 
outstanding preferred stock and/or outstanding pollution control 
revenue bonds issued for MP&L's benefit, at any time, prior to December 
31, 2000.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-28398 Filed 11-16-95; 8:45 am]
BILLING CODE 8010-01-M