[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
