[Federal Register Volume 63, Number 113 (Friday, June 12, 1998)]
[Notices]
[Pages 32271-32272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-15633]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35--26882]
Filings Under the Public Utility Holding Company Act of 1935, as
Amended (``Act'')
June 5, 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
[[Page 32272]]
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 June 29, 1998, 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
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 June 29, 1998, the application(s) and /or declaration(s),
as filed or as amended, may be granted and/or permitted to become
effective.
PP&L Resources, Inc. (70-9165)
PP&L Resources, Inc. (``Resources''), Two North Ninth Street,
Allentown, Pennsylvania 18101, a holding company exempt by order under
section 3(a)(1) of the Act, has filed an application under sections
9(a)(2) and 10 of the Act for an order authorizing it to acquire all of
the issued and outstanding common stock of Penn Fuel Gas, Inc.
(``PFG''), a holding company exempt by order under section 3(a)(1) of
the Act (``Transaction''). Resources also requests an order under
section 3(a)(1) exempting it and all of its subsidiary companies from
all provisions of the Act, except section 9(a)(2), after the
Transaction is completed.
Resources is the parent holding company of PP&L, Inc. (``PP&L'').
PP&L provides electric service to approximately 1.2 million customers
in its retail service territory in Pennsylvania at retail rates.
Additionally, PP&L sells electricity at retail throughout Pennsylvania
under the state's retail access pilot programs. Finally, PP&L markets
wholesale electric power throughout the eastern United States. PP&L
operates its generation and transmission facilities as part of the
Pennsylvania-New Jersey-Maryland Interconnection Association. PP&L is
subject to regulation by the Pennsylvania Public Utility Commission
(``PaPUC'') with respect to retail electric rates and other matters.
PP&L also is a holding company exempt from regulation under the Act
under section 3(a)(2). PP&L owns 33.3% of the capital stock and 50% of
the voting stock of Safe Harbor Water Power Corporation (``Safe
Harbor''), which owns and operates a hydroelectric plant on the
Susquehanna River in south central Pennsylvania. The entire output of
the plant is sold to PP&L and Baltimore Gas & Electric, which owns the
balance of the Safe Harbor capital and voting stock.
Resources has several nonutility subsidiaries. One subsidiary, PP&L
Global invests in electric generation, transmission and distribution
facilities both overseas and domestically.\1\ Another subsidiary, PP&L
Spectrum, Inc., provides energy-related products and services both
inside and outside of PP&L's service territory. A third subsidiary,
Interstate Energy Company, operates oil and gas pipeline facilities
that supply fuel to a PP&L generating station. Two subsidiaries, Realty
Company of Pennsylvania and BDW Corporation, own real estate and other
interests related to the operation of PP&L's generating stations. One
subsidiary, PP&L Capital Funding, Inc., engages in debt financing
activities on behalf of Resources. Another subsidiary, CEPT Group,
Inc., holds passive investments in securities for investment purposes.
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\1\ Each of the entities invested in by PP&L Global, Inc. is
either an exempt wholesale generator or a foreign utility company
under the Act.
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For the year ended December 31, 1997, Resource's operating revenues
on a consolidated basis were approximately $3.049 billion, of which
approximately $90 million was attributable to nonutility activities.
Resources' consolidated assets at December 31, 1997 were approximately
$10.0 billion, of which approximately $6.8 billion consisted of net
electric plant and equipment.
PFG owns two utility subsidiaries, PFG Gas, Inc. (``PFG Gas'') and
North Penn Gas Company (``NPG''). PFG Gas provides natural gas
distribution service to approximately 35,000 customers in Pennsylvania
and to approximately 200 customers in Maryland. NPG provides natural
gas distribution service to approximately 34,500 customers in
Pennsylvania. PFG Gas and NPG also each provide natural gas
transportation and storage services in Pennsylvania.
PFG Gas and North Penn are each subject to regulation by the PaPUC
with respect to rates and other matters. In addition, PFG Gas is
subject to the jurisdiction of the Maryland Public Service Commission
with respect to rates and other matters for its utility business
conducted in that state.
For the year ended December 31, 1997, PFG's operating revenues on a
consolidated basis were approximately $119 million, of which
approximately $106 million were attributable to its gas utility
operations. Consolidated assets PFG and its subsidiaries as of December
31, 1997, were approximately $150 million. PFG has no nonutility
subsidiaries.
The Transaction will be governed by the terms of a June 26, 1997
Agreement and Plan of Merger (``Agreement'') by and among Resources,
Keystone Merger Corp. (``Keystone''), a wholly owned subsidiary of
Resources, and PFG. Keystone was organized solely for the purpose of
the Transaction and is not engaged in any business operations. Under
the terms of the Agreement, Keystone will be merged into PFG and PFG
will survive as a wholly owned subsidiary of Resources. Each share of
PFG common stock outstanding prior to the Transaction will be converted
into the right to receive between 6.968 and 8.516 shares of Resources
common stock, depending on the market price of Resources common stock
at the time of closing. PFG common stock shareholders will become
Resources common stock shareholders, and Resources will become the sole
holder of all outstanding PFG common stock.
In addition to its common stock, PFG has issued $1.40 cumulative
preferred stock (``PFG Preferred''). PFG has undertaken to redeem
shares of the PFG Preferred in accordance with its terms. PFG Preferred
shareholders will receive either the redemption price or the right to
receive between 0.682 and 0.833 shares of Resources common stock,
depending on the market price of Resources common stock at the time of
closing.
Following the Transaction, Resources and each of its public utility
subsidiaries will be organized in Pennsylvania. Resources contends that
it will quality for a section 3(a)(1) exemption upon consummation of
the Transaction. In addition, Resources states that, following the
Transaction, PP&L will continue to meet the requirements for exemption
under section 3(a)(2), and PFG will continue to meet the requirements
for an exemption under section 3(a)(1).
For the Commission, by the Division of Investment Management,
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-15633 Filed 6-11-98; 8:45 am]
BILLING CODE 8010-01-M
