[Federal Register Volume 60, Number 228 (Tuesday, November 28, 1995)]
[Notices]
[Pages 58702-58705]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-29002]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26415; International Series Release No. 888]
Filings Under the Public Utility Holding Company Act of 1935, as
amended (``Act'')
November 21, 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 18, 1995, 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 by 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.
Northeast Utilities (70-7883)
Northeast Utilities (``Nu''), 174 Brush Hill Avenue, West
Springfield, Massachusetts 01090-0010, a registered holding company,
has filed a post-effective amendment to its application-declaration
under sections 6(a), 7, 9(a), and 10 of the Act and rule 54 thereunder.
By order dated November 18, 1991 (HCAR No. 25411) (``Order''), the
Commission approved the issuance and sale of up to 11 million NU common
shares, $5.00 par value, to an employee stock ownership plan (``ESOP'')
trust to be added to a NU system 401(k) plan (``Plan'').
In accordance with the terms of the Order, the Plan, and the ESOP
trust agreement, the ESOP trustee votes allocated ESOP shares as
directed by the employee participants who beneficially own the
allocated shares, and abstains from voting allocated ESOP shares for
which no direction from the beneficial owner is received. No change in
the voting of allocated ESOP shares is contemplated.
However, under the Order the ESOP trustee votes the unallocated
shares in the same proportion of yes and no votes and abstentions as it
votes the allocated shares. This results in a large number of
abstentions of unallocated ESOP shares. The nonvoted unallocated shares
represented almost 3 percent of NU's shares outstanding at the time of
its last annual meeting on May 23, 1995.
NU now proposes to amend the Plan and the ESOP trust agreement to
modify the manner in which the ESOP trustee votes the unallocated
shares held in the ESOP trust. Under the proposed change, allocated
ESOP shares would still be voted in accordance with participant
instructions, including abstaining from voting allocated ESOP shares
for which no instructions are received. However, unallocated ESOP
shares would be voted ``yes'' or ``no'' in the same proportions as
allocated ESOP shares for which voting instructions are received.
In a ``no-action'' letter dated March 25, 1992, the Commission
staff analyzed the trust holdings of NU common shares under the Plan,
including the voting requirements for the ESOP shares, and concluded
that it would not recommend any enforcement action under the Act that
would result in the Plan or the bank trustee under the Plan being
deemed to be a ``holding company,'' as defined in section 2(a)(7)(A) of
the Act, or an ``affiliate,'' as defined in section 2(a)(11)(A) of the
Act, on account of the
[[Page 58703]]
trustee's holding and voting the NU common shares under the Plan. NU
believes that following the change in the voting of unallocated shares
described above, the ESOP trustee should still not be deemed to ``own,
control, or hold with power to vote'' the shares held in the ESOP
trust, and that such shares should still not be counted in determining
whether the Plan or the ESOP trustee is a ``holding company'' or
``affiliate'' of NU under the Act, because the ESOP trustee will still
have no discretion as to how ESOP shares are voted.
NorAm Energy Corp. (70-8673)
NorAm Energy Corporation (``NorAm''), 1600 Smith, 11th floor,
Houston, Texas, 77002, has filed an application under Section 3(b) of
the Act for an order of exemption in connection with its contemplated
acquisition, for an aggregate investment of up to $150 million over the
next five-year period, of (i) An interest in concessions granted by the
government of Colombia to establish natural gas distribution services
to areas in Colombia, (ii) an interest in concessions granted by the
government of Mexico to establish natural gas distribution services in
Mexico, and (iii) a minority interest in one or more existing Mexican
natural gas distribution businesses.
NorAm is engaged in the distribution and transmission of natural
gas, with business and operations in Texas, Louisiana, Arkansas,
Mississippi, Oklahoma, Missouri and Minnesota. NorAm is not a public
utility holding company under the Act.
NorAm proposes to participate in the purchase of an interest in
concessions granted by the government of Colombia. NorAm will acquire
minority interests in each concession through ownership of a Colombian
corporation (``Colombian Corporation'').
NorAm also proposes to participate in the purchase of an interest
in concessions granted by the government of Mexico and the purchase of
minority interests in one or more existing Mexican natural gas
distribution businesses. NorAm will participate in such acquisitions
through a memorandum of understanding entered into with Grupo Gutsa and
TransCanada Pipelines for the creation of a subsidiary in Mexico
(``Mexican Corporation''). NorAm's interests in the Colombian
concessions and the Mexican concessions and businesses will in each
instance not exceed 49%.
The concessions and existing Mexican gas distribution businesses
would be gas utility companies under the Act. Thus NorAm, the Colombian
Corporation and the Mexican Corporation would each be a holding company
under the Act.
Section 3(b) of the Act authorizes the Commission to exempt any
subsidiary company of a holding company from the Act if such subsidiary
company derives no material part of its income, directly or indirectly,
from sources within the United States, and neither it nor any of its
subsidiary companies is a public utility company operating in the
United States.
NorAm states that neither the concessions nor the existing
businesses will derive any income, directly or indirectly, from sources
in the United States, and will operate, or have any subsidiary
operating, as a public utility company in the United States. NorAm
further states that the proposed acquisitions will not affect or impair
utility functions or the financial condition of NorAm. Under these
circumstances, NorAm states that it is not necessary in the public
interest or for the protection of investors to subject the concessions
or the existing businesses to any provisions of the Act.
Entergy Corporation, et al. (70-8681)
Entergy Corporation (``Entergy''), 639 Loyola Avenue, New Orleans,
Louisiana 70113, a registered holding company, and its wholly-owned,
nonutility subsidiary company, Entergy Enterprises, Inc.
(``Enterprises''), Three Financial Centre, Little Rock, Arkansas 72211,
have filed an application-declaration under sections 6(a), 7, 9(a), 10,
12(b) and 13 of the Act and rules 45 and 54 thereunder.
Entergy proposes to invest up to $30 million through September 30,
1997, in one or more new direct or indirect subsidiaries of Entergy
and/or Enterprises (``New Subsidiaries''). The investments would be in
the form of acquisitions of stock and/or debt securities, capital
contributions, open account advances, guarantees of indebtedness or
other extensions of credit, whether directly in the New Subsidiary or
through one or more New Subsidiary intermediate holding companies. As a
percentage of consolidated assets of the Entergy System ($22.5 billion
at June 30, 1995), the proposed investments would amount, in the
aggregate, to not more than 0.133%. Interest on the debt securities
would be established at a rate not to exceed the prime rate in effect
on the date of the issuance of the securities at a bank designated by
Entergy, and the debt securities would have a maturity not later than
December 31, 2005.
The New Subsidiaries either directly or indirectly would acquire
interests in nonutility businesses including, among others, network-
based businesses, telecommunications, energy and security management
services businesses or environmental technology businesses. Network-
based businesses or telecommunications would involve wired or wireless
networks or systems, including, among others, cable or personal
communications or other data communications services, which could be
interactive and developed to permit utility applications, including
remote meter reading and reporting of power outages. Such businesses
could operate inside and outside the Entergy System's service
territory, or both. The proceeds from the investments will not be used
to invest directly or indirectly in an exempt wholesale generator or
foreign utility company.
The proposed investments would be made nonrecourse as to other
Entergy System companies and assets, and be isolated in one or more New
Subsidiaries. Enterprises would provide services to the New
Subsidiaries of the types and at the prices specified pursuant to the
Commission's order dated June 30, 1995 (HCAR No. 26322). To the extent
that additional affiliate transactions between the New Subsidiaries and
other Entergy System companies, except for the investments and the
provision of services by Enterprises, become necessary, the applicants
will seek any requisite regulatory approval at the time.
Cinergy Corp., et al. (70-8717)
Cinergy Corp., a registered holding company, and Cincinnati Gas &
Electric Company (``CG&E''), its wholly-owned public-utility subsidiary
company (collectively, ``Applicants''), both located at 139 East Fourth
Street, Cincinnati, Ohio 45202, have filed a declaration under section
12(d) of the Act and rules 42, 44 and 54 thereunder. Applicants request
authorization for CG&E to sell certain moveable property of its
Woodsdale Generating Station, Units 1 and 7, including gas combustion
turbines, transformers, boilers and water pumps (``Equipment''), to a
non-affiliated third-party finance lessor which would concurrently
lease back the Equipment to CG&E.\1\
\1\ Applicants are not seeking authorization from this
Commission for the leaseback of the Equipment. CG&E has applied to
the Public Utilities Commission of Ohio (``PUCO''), the state
commission with jurisdiction over CG&E, for approval of the
leaseback transaction. Upon receipt of a PUCO order approving the
leaseback (a copy of which will be filed with this Commission by
amendment to applicant's declaration), applicants will rely on the
exemption provided by section 9(b)(1) of the Act.
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Applicants expect the Equipment to be sold for an amount not to
exceed $40
[[Page 58704]]
million and not less than its net book value (estimated to be not less
than $20 million), depending on its aggregate appraised value, as
determined by an independent appraiser to be selected by the buyer.
CG&E would use the net proceeds from the sale of the Equipment to
redeem, prior to maturity, all or some of one or more series of its
outstanding first mortgage bonds and repay short-term debt incurred in
connection with such redemption.\2\ The balance, if any, of such net
proceeds would be used for other general corporate purposes. CG&E is
currently considering the redemption, in whole or in part of its First
Mortgage Bonds, 10.20% Series due December 1, 2020, which are callable
December 1, 1995 at a redemption price of 107.44% plus accrued interest
to the redemption date.\3\
\2\ If short-term debt is used to redeem bonds prior to
receiving regulatory authority for the sale of the Equipment, CG&E
will use net Equipment sale proceeds to repay all or a portion of
such short-term debt.
\3\ As of September 30, 1995, these bonds had an aggregate
principal amount of $150 million outstanding.
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Applicants state that the proposed redemption of high cost first
mortgage bonds using the Equipment sale proceeds is expected to produce
greater cost savings than might otherwise be achieved if CG&E were to
issue and sell other securities to fund the redemption.
National Fuel Gas Company, et al. (70-8729)
National Fuel Gas Company (``National''), a registered holding
company, 10 Lafayette Square, Buffalo, New York 14203, and its wholly-
owned subsidiary companies: National Fuel Gas Distribution Corporation
(``Distribution''), National Fuel Gas Supply Corporation (``Supply''),
Seneca Resources Corporation (``Seneca''), Highland Land & Minerals,
Inc. (``Highland''), Leidy Hub, Inc. (``Leidy''), Horizon Energy
Development, Inc. (``Horizon''), Data-Track Account Services, Inc.
(``Data-Track''), all located at 10 Lafayette Square, Buffalo, New York
14203, National Fuel Resources, Inc. (``NFR''), 478 Main Street,
Buffalo, New York 14202 and Utility Constructors, Inc. (``UCI''), East
Erie Extension, Linesville, Pennsylvania 16424 (collectively,
``Subsidiary Companies''), have filed an application-declaration
pursuant to sections 6(a), 7, 9(a), 10, 12 (b) and 12(f) of the Act and
rules 43, 45 and 54 thereunder.
By prior Commission order, National and its Subsidiary Companies
were authorized to participate in the National system money pool
(``Money Pool'') through December 31, 1995. National and its Subsidiary
Companies now propose to continue to participate in, and incur short-
term borrowings from the Money Pool, through December 31, 2000. Total
outstanding short-term borrowings from the Money Pool by Distribution
will not exceed a principal amount of $315 million. National will not
borrow funds from any Subsidiary Company through the Money Pool.
In addition, in the event that intra-system sources of funds are
insufficient to meet short-term needs of the Subsidiary Companies,
National proposes, from time-to-time through December 31, 2000, to: (1)
Issue and sell, up to $300 million aggregate principal amount at any
one time outstanding of commercial paper (``Commercial Paper'')
directly or through dealers and placement agents; and/or (2) issue an
aggregate principal amount of up to $600 million of short-term
unsecured notes (``Notes'') under credit facilities with banks and
financial institutions. The aggregate principal amount of such
Commercial Paper and Notes shall not exceed $600 million outstanding at
any one time. The proceeds of such external borrowings by National
shall be made available to its Subsidiary Companies through the Money
Pool. In addition, National proposes that up to $75 million of its
external borrowing be made available for its own corporate purposes.
If only surplus funds of National and its Subsidiary Companies make
up the funds available in the Money Pool, the interest rate applicable
and payable to or by the Subsidiary Companies for all loans of such
surplus funds will be the rates for high grade unsecured 30-day
commercial paper sold through dealers by major corporations as quoted
in The Wall Street Journal.
If external funds make up all of the funds available in the Money
Pool, or when surplus funds from National and other participating
Subsidiary Companies and external funds are concurrently borrowed
through the Money Pool, the interest rate applicable to all such
borrowings and payable by borrowing Subsidiary Companies will be equal
to National's net cost for such external borrowings.
The borrowing arrangements with banks or financial institutions may
require compensating balances and/or commitment fees or similar fees.
National requests authority to incur, if necessary, commitment or
similar fees not to exceed one-half (\1/2\) of one percent (1%) of
average daily credit facilities available, and/or compensating balances
not to exceed twenty percent (20%) of the credit facility established.
National, at all times, will attempt to negotiate the most favorable
effective borrowing rate taking into account any compensating balances
and/or fees.
National has, and from time to time through December 31, 2000, will
continue to enter into interest rate and currency exchange agreements
(``Swap Agreement(s)'') with one or more parties (``Counterparty''),
covering a total principal amount of up to $300 million for terms of
one month to five years. In no event will the effective fixed rate of
interest paid by National inclusive of any fees, exceed by more than
2.0% per annum the yield, at the time of entering into any such Swap
Agreement, on direct obligations of the U.S. Government with maturities
comparable to that of the applicable Swap Agreement. From time to time,
National may be obligated to pay arrangement fees and/or legal fees and
other expenses in connection with these Swap Agreements. National
requests authority to allocate all such fees and expenses together with
the payments made to a Counterparty or received from a Counterparty
among National and the Subsidiary Companies based upon their weighted
average amount of borrowings outstanding during the period when such
amounts are paid or received.
Consolidated Natural Gas Company (70-8739)
Consolidated Natural Gas Company (``Consolidated''), CNG Tower, 625
Liberty Avenue, Pittsburgh, Pennsylvania 15222, a registered holding
company, has filed a declaration under sections 6(a), 7, 9(a), 10, and
12(c) of the Act and rules 42 and 54 thereunder.
Consolidated seeks authorization to implement a stockholder rights
plan (``Plan'') and to enter into a related Rights Agreement
(``Agreement'') with Society National Bank, as agent. To implement the
Plan, the board of directors of Consolidated would declare a dividend
distribution of one right (``Right'') for each outstanding share of
common stock, $2.75 par value, of Consolidated (``Common Stock'') to
stockholders of record at the close of business on a specified record
date. Each Right would entitle the holder to purchase from Consolidated
one-half of a share of Common Stock at a price of $175 per share
($87.50 per half-share), subject to adjustment (``Purchase Price'').
Initially, the Rights will be evidenced by the certificates for shares
of Common Stock to which they relate, and will be transferable only
with the Common Stock. Until a Right is exercised or exchanged for
Common Stock, as described below, the holder, as
[[Page 58705]]
such, will have no rights as a stockholder of Consolidated.
Upon the earlier to occur of (a) ten days after the date (``Shares
Acquisition Date'') of the public announcement that a person or
affiliated group (``Acquiring Person'') has acquired or obtained the
right to acquire beneficial ownership of securities having 10% or more
of the voting power of the outstanding voting securities of
Consolidated, or (b) ten days after commencement of, or announcement of
the intention of a person to make, a tender or exchange offer that
would result in such person acquiring, or obtaining the right to
acquire, beneficial ownership of securities having 10% or more of the
voting power of the outstanding voting securities of Consolidated (such
earlier date being the ``Distribution Date''), separate certificates
evidencing the Rights will be mailed to holders of record of Common
Stock as of the close of business on the Distribution Date.
The Rights will become exercisable after the Distribution Date on
the following terms: (1) If a person becomes an Acquiring Person after
the Distribution Date, each holder (other than an Acquiring Person) may
exercise a Right and receive Common Stock (or, in certain cases, cash,
property or other securities of Consolidated) having a value equal to
two times the Purchase Price of the Right then in effect. Rights that
are beneficially owned by an Acquiring Person will be null and void.
(2) If, after the Shares Acquisition Date, Consolidated is acquired in
a business combination transaction of 50% or more of its assets or
earning power is sold or transferred, each holder of a Right will have
the right to receive, upon exercise, common stock of the acquiring
company having a value equal to two times the Purchase Price of the
Right then in effect.
The Purchase Price is subject to adjustment to prevent dilution in
certain situations involving stock dividends, splits, combinations or
reclassification; grants of warrants to subscribe for or purchase
Common Stock or convertible securities at less than market price; or
distribution to holders of Common Stock of evidences of indebtedness or
assets or of subscription rights or warrants. Adjustments will be
required upon the earlier of three years from the date of the event
giving rise to the adjustment or the time when cumulative adjustments
require a 1% or more change in the Purchase Price.
Consolidated may redeem the Rights in whole, but not in part, prior
to 5 p.m. on the tenth day after the Shares Acquisition Date (subject
to extension by the board of directors of Consolidated for an
additional 20 days), at a price of $0.01 per Right, payable in cash or
stock. In addition, at any time after a person becomes an Acquiring
Person, the board may exchange the Rights (other than Rights held by an
Acquiring Person, which become void), in whole or in part, at an
exchange ratio of one share of Common Stock (and/or other securities,
cash or other assets having the same value as a share of Common Stock)
per Right, subject to adjustment.
The Agreement may be amended by the board of directors of
Consolidated without the consent of the holders of Rights prior to the
Distribution Date. Therefore, the board may amend the Agreement in
order to cure any ambiguity, defect or inconsistency or to make changes
that do not adversely affect the interests of holders of Rights (other
than any Acquiring Person), provided that no amendment may be made on
and after the Distribution Date that changes the principal economic
terms of the Rights.
Yankee Atomic Electric Company (70-8743)
Yankee Atomic Electric Company (``Yankee Atomic''), 580 Main
Street, Bolton, Massachusetts 01740, a subsidiary of both New England
Electric System and Northeast Utilities, both registered holding
companies, has filed an application under sections 6(a) and 7 of the
Act and rule 54 thereunder.
By order dated March 11, 1994 (HCAR No. 26002), Yankee Atomic was
authorized to borrow up to $10 million through December 31, 1995.
Yankee Atomic now proposes to borrow money from one or more banks
up to a maximum aggregate amount outstanding at one time of $10
million, from January 1, 1996 through December 31, 1997.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-29002 Filed 11-27-95; 8:45 am]
BILLING CODE 8010-01-M