[Federal Register Volume 63, Number 146 (Thursday, July 30, 1998)]
[Notices]
[Pages 40747-40748]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-20314]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-26899; International Series Release No. 1147]


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

July 23, 1998.
    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 under the Act. 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 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 August 18, 1998, to this 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 
should 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 August 18, 1998, the application(s) and/or 
declaration(s), as filed or as amended, may be granted and/or permitted 
to become effective.

The Southern Company, et al. (70-8733)

    The Southern Company (``Southern''), a registered holding company, 
270 Peachtree Street, N.W., Atlanta, Georgia 30303, and its nonutility 
subsidiaries Southern Energy, Inc. (formerly SEI Holdings, Inc.) 
(``Southern Energy''), Mobile Energy Services Holdings, Inc. 
(``Holdings''), Southern Energy Resources, Inc. (formerly Southern 
Energy, Inc.) (``Resources''), Southern Energy North America, Inc. 
(``SENA'') and Mobile Energy Services Company, L.L.C. (``MESCA''), each 
at 900 Ashwood Parkway, Atlanta, Georgia 30338, have filed a post-
effective amendment under sections 6(a), 7, 9(a), 10, 12(c), 12(d) and 
12(f) of the Act and rules 43, 45, and 54 under the Act to an 
application-declaration filed under sections 6(a), 7, 9(a), 10, 12(b), 
12(f), 13, 32 and 33 of the Act and rules 43, 45 and 54 under the Act.
    MESC is a limited liability company established under Alabama law 
that owns and operates a dedicated, ``inside-the-fence,'' industrial 
cogneration complex in Mobile, Alabama. Holdings, a direct nonutility 
subsidiary of Southern, owns 99% of the outstanding membership 
interests of MESC, and Resources, an indirect nonutility subsidiary of 
Southern, owns the remaining one percent of the membership 
interests.\1\ Southern Energy is a direct nonutility subsidiary of 
Southern engaged in owning interests in certain businesses, including 
qualifying facilities (as defined in the Public Utility Regulatory 
Policies Act of 1978). SENA is a direct subsidiary of Southern Energy, 
which owns interests in Southern Energy's domestic businesses.
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    \1\ Alabama law requires that domestic limited liability 
companies have at least two members.
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    Applicants propose to restructure the ownership of membership 
interests in MESC. Alabama law provides for the bifurcation of 
membership interests of limited liability companies into economic 
interests and voting interests. Economic interests encompass the right 
to share in profits and losses and voting interests include all rights 
of management and control. Applicants propose that Holdings and 
Resources transfer a 99% economic interest and a 1% voting interest in 
MESC to a direct or indirect subsidiary of Southern Energy. Applicants 
state that the proposed relocation of economic interest in MESC to a 
Southern Energy subsidiary will facilitate evaluations of the 
performance of Southern's independent energy portfolio by interested 
parties, including the investment community.
    Applicants propose to accomplish this restructuring in several 
steps. Southern Energy would establish a special purpose subsidiary 
(``SE Mobile'') as a vehicle to hold its interests in MESC. Holdings 
would exchange its existing membership interests in MESC for two 
classes of membership interests, one representing voting interests and 
the other nonvoting economic interests. Holdings would then transfer a 
98% nonvoting economic interest in MESC to SE Mobile and Resources 
would then contribute its one percent economic and voting interest to 
SE Mobile. As a result, Holdings would retain its 99% voting interest 
and a one percent economic interest in MESC and SE Mobile would own a 
99% economic interest and a one percent voting interest in MESC.
    The Applicants request authority to complete the restructuring by 
June 30, 2000.

UtiliCorp United Inc. (70-9325)

    UtiliCorp United Inc. (``UtiliCorp''), 20 West Ninth Street, Kansas 
City, Missouri 64105, a Delaware public utility holding company 
claiming exemption from registration under rule 10 of the Act, has 
filed a declaration under section 3(b) and rules 10 and 11(b)(1) under 
the Act.
    UtiliCorp is a publicly traded corporation which engages primarily, 
through divisions, in the sale and distribution of gas and electrically 
to retail and wholesale customers in nine states, Canada, New Zealand 
and Australia. UtiliCorp is a public-utility holding company solely 
because of its ownership of West Kootenay Power and Light Company, 
Limited,\2\ a Canadian public utility company, WEL Energy Group 
Limited,\3\ a New Zealand electric utility company, and United Energy 
Ltd.,\4\ an Australian electric distribution company. As of December 
31, 1997, UtiliCorp had sales of $8.926 billion, earnings before 
interest and taxes of $359.1 million and total assets of $5.113 
billion.
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    \1\ UtiliCorp United Inc., Holding Company Act Release No. 24204 
(Oct. 1, 1986).
    \2\ UtiliCorp United Inc., Holding Company Act Release No. 25850 
(July 8, 1993).
    \3\ UtiliCorp United Inc., Holding Company Act Release No. 26353 
(Aug. 7, 1995).
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    UtiliCorp states that the government of the State of Victoria, 
Australia (``Victoria government'') has decided to privatize its 
natural gas industry to develop a competitive energy market in order to 
facilitate lower gas prices and improved service for consumers. Through 
one or more subsidiaries, UtiliCorp proposes to participate in the 
bidding process for one or more following seven businesses, each 
organized under the laws of Australia and each operating solely in 
Australia: (1) Kinetick Energy (``Kinetick''), a retail gas company, 
serving the northeastern and western suburbs of Melbourne; (2) Westar 
(``Westar''), a gas distribution company, serving the western suburbs 
of Melbourne, with fixed assets valued at approximately N.Z. $591.8 
million; (3) Ikon Energy (``Ikon''), a gas retail company, operating 
primarily in the western central and southeastern suburbs of Melbourne; 
(4) Multinet (``Multinet''), a gas distribution company, operating in 
the eastern

[[Page 40748]]

metropolitan area of Melbourne, with fixed assets valued at 
approximately N.Z. $650.5 million; (5) Energy 21 (``Energy 21''), a gas 
retail company, serving eastern Melbourne, the Morningstar Peninsula 
and northern and western Victoria; (6) Stratus (``Stratus''), a gas 
distribution company, with fixed assets valued at approximately N.Z. 
$650.5 million, serving the northern and southeastern suburbs of 
Melbourne and the Morningstar Peninsula; and (7) Gas Transmission 
Corporation (``GTC''), a gas transmission and supply company (Kinetick, 
Westar, Ikon, Multinet, Energy 21, Stratus and GTC collectively, 
``Australian Companies'').
    The bidding process for the Australian Companies will be conducted 
by the Victorian government in two phases, commencing in June 1998 and 
ending in November 1998. For purposes of the bidding process, the 
paired companies of Kinetik and Westar, Ikon and Multinet, and Energy 
21 and Stratus, are regarded as ``stapled'' businesses. UtiliCorp 
expects to submit bids for the Australian Companies through one or more 
subsidiaries, which may invest as a member of a group on consortium. 
For Australian tax considerations, UtiliCorp explains that it may 
structure the proposed acquisitions as a series of asset and stock 
acquisitions.
    UtiliCorp proposes to acquire an equity ownership interest of up 
to, but not more than, 50% in one or more of the three stapled 
businesses. With respect to GTC, UtiliCorp proposes to acquire a less 
than twenty percent interest. UtiliCorp plans to invest no more than 
$500 million in any combination of permissible acquisitions under the 
bidding rules established by the Victorian government.\5\
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    \5\ UtiliCorp expects to acquire the Australian Companies in the 
near term using bank borrowings at a subsidiary level, which may 
require a guarantee by UtiliCorp or from its existing earnings and/
or debt facilities at the UtiliCorp level. UtiliCorp states that its 
obligations are subject to multiple state approvals.
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    Neither UtiliCorp nor any corporation owned or controlled by 
UtiliCorp is a holding company subject to regulation under the Act or a 
subsidiary company of a holding company subject to regulation under the 
Act. None of the Australian Companies is a public utility company 
operating in the United States. None of the Australian Companies 
presently serves, and following the proposed acquisitions by UtiliCorp 
none will serve, customers in the United States. None of the Companies 
is qualified to do business in any state of the United States; each 
operates exclusively within Australia.
    UtiliCorp requests an order under section 3(b) of the Act exempting 
each of the Australian Companies from all provisions of the Act. 
UtiliCorp states that none of the Australian Companies will derive any 
material part of its income, directly or indirectly, from sources 
within the United States. Further, none of the Australian Companies 
will be, or have any subsidiary company which is, a public utility 
company operating in the United States. UtiliCorp asserts that rule 
10(a)(1) will provide an exemption for UtiliCorp and any subsidiary of 
UtiliCorp insofar as they are holding companies of the Australian 
Companies. Further, UtiliCorp asserts that rule 11(b)(1), together with 
rule 10(a)(1), will provide an exemption from the approval requirements 
of sections 9(a)(2) and 10 to which UtiliCorp would otherwise be 
subject.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-20314 Filed 7-29-98; 8:45 am]
BILLING CODE 8010-01-M