[Federal Register Volume 59, Number 170 (Friday, September 2, 1994)]
[Notices]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-21704]
[[Page Unknown]]
[Federal Register: September 2, 1994]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26113; International Series Release No. 705]
Filings Under the Public Utility Holding Company Act of 1935
(``Act'')
August 26, 1994.
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 amendment 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 September 19, 1994, 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 the 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.
Entergy Corporation (70-8445)
Entergy Corporation (``Entergy''), 225 Baronne Street New Orleans,
Louisiana 70112, a registered holding company, has filed an
application-declaration with the Commission under Sections 3(b), 6(a),
7, 9(a), 10, 12(b), 32 and 33 of the Act and Rules 10, 43, 45, 53, and
54.
Entergy seeks exemptions from the Act in connection with the
acquisition of the securities of one or more subsidiary companies
(collectively, ``Subsidiary Companies'') which will be engaged directly
or indirectly, and exclusively, in the business of owning and holding
the securities of a new Argentine company (``Newco''). Newco will be
formed to bid for the right to build, own and operate proposed high
voltage transmission line (``Project'') in northeast Argentina. Entergy
states that Newco would qualify as a ``foreign utility company'' under
Section 33 of the Act. Therefore, Entergy requests that the Commission
issue an order under Section 3(b) exempting the certain Subsidiary
Companies from all provisions of the Act that would be applicable to
such companies as ``subsidiary companies'' of Entergy. In the
Alternative, Entergy proposes to acquire the securities of the
Subsidiary Companies under all other applicable sections and rules
thereunder of the Act.
The Project is designed to carry electricity from the Yacyreta
hydroelectric facility, now under construction, to the high voltage
transmission system owned and operated by Transener S.A. Entergy
Currently owns an indirect 9.8% interest in Transener S.A. through its
wholly owned subsidiary company, Entergy Transener S.A., which is also
a ``foreign utility company'' under Section 33 of the Act. The Project
is expected to take up to 22 months to complete at a total cost of up
to approximately U.S. $300 million. Entergy will be participating in
the Project with a consortium of other U.S. and international investors
(``Consortium'').
Entergy contends that for various tax and legal reasons, it is
preferable to hold its interest in Newco indirectly through the
Subsidiary Companies. Entergy further asserts that the particular
ownership structure to be used for the Project will depend on, among
other things, the requirements of the documents relating to the bidding
for the Project (``Bid Documents''). The Bid Documents currently
require that the shareholders of Newco, collectively, have an aggregate
net worth of at least $150 million. The terms of the Bid Documents
further provide that, during the construction period for the Project,
each shareholder of Newco is jointly and severally liable together with
Newco for all obligations arising out of construction, including
damages. In view of such requirements, as well as the possible
requirements of Project lenders, Entergy proposes that it may fully or
partially capitalize one or more of the Subsidiary Companies (but not
newco) with amounts up to its proportionate share of the Project's
estimated total cost either prior to the submission of the Cosortium's
bid or to facilitate the financial closing of the Project. Entergy
expects that its total investment in connection with the Project,
including any contingent liabilities of a Subsidiary Company as a
shareholder of Newco, would in no event exceed $90 million.
Entergy proposes that within 45 days after a determination is made
not to proceed with an acquisition of an interest in the Project, it
will liquidate or dissolve the Subsidiary Companies, unless Entergy
determines to utilize the Subsidiary Companies in conjunction with
another exempt acquisition under Sections 32 or 33 of the Act.
Therefore, Entergy requests authorization from the Commission to effect
such a liquidation or dissolution.
The direct or indirect investments in the Subsidiary Companies may
take the form of: (1) purchases of capital stock, partnership
interests, notes or other securities; (2) capital contributions or open
account advances; (3) guarantees, letters of credit or other credit
support (collectively, Guarantees'') arranged or provided by Entergy in
respect of the securities or other obligations of a Subsidiary Company
or Newco in connection with the Project; or (4) any combination of the
above. Investments by Entergy in the capital shares or other equity
securities of Subsidiary Companies having a stated or par value will be
in an amount not less than such stated or par value. Open account
advances by Entergy to a Subsidiary Company would be non-interest
bearing and repayable within one year of the advance. Any promissory
notes or other evidences of indebtedness issued by a Subsidiary Company
to Entergy would: (1) mature not late than 30 years after the date of
issuance thereof; and (2) bear interest at a rate not greater than the
prime rate of a bank to be designated by Entergy. Any such promissory
note or other evidences of indebtedness may, at Entergy's option, be
converted to a capital contribution through Entergy's forgiveness of
the indebtedness evidenced thereby.
Entergy requests authority through December 31, 1997 to issue
Guarantees in an aggregate amount that, when added to investments in
the Subsidiary Companies and Newco otherwise made as provided above,
will not exceed $90 million. Guarantees may be required, among other
things, to satisfy credit support requirements of lenders and other
Project participants under financing documents or other agreements to
which the Subsidiary Companies or Newco becomes a party in connection
with the development of the Project. The terms of, and any fees or
interest payable in respect of, Guarantees will be established at arm's
length based on market conditions; provided that (1) the term of any
Guarantee would not exceed ten years from the date of issuance thereof,
and (2) any fees with respect to any Guarantee would not exceed three
percent per annum of the face amount of such Guarantee.
Funds for Entergy's direct or indirect investments in the
Subsidiary Companies and in Newco are expected to be derived from
Entergy's available internal cash resources. Entergy also anticipates
that the Subsidiary Companies will not engage in any financial from
external sources in connection with the Project.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-21704 Filed 9-1-94; 8:45 am]
BILLING CODE 8010-01-M
