ENRON AND SIERRA PACIFIC RESOURCES ANNOUNCE PURCHASE AGREEMENT FOR PORTLAND GENERAL ELECTRIC
FOR IMMEDIATE RELEASE: Monday, November 8, 1999
HOUSTON – Enron Corp. (NYSE: ENE) and Sierra Pacific Resources (NYSE: SRP) announced today that they have entered into a purchase and sale agreement for Enron’s wholly owned electric utility subsidiary, Portland General Electric (PGE). Under terms of the agreement, Enron will sell PGE to Sierra Pacific for $2.1 billion, comprised of $2.02 billion in cash and the assumption of Enron’s approximately $80 million merger payment obligation. Sierra Pacific will also assume $1 billion in PGE debt and preferred stock. The proposed transaction, which is subject to customary regulatory approvals, is expected to close in the second half of 2000.
“We have been very pleased with the performance of Portland General,” said Kenneth L. Lay, Enron chairman and CEO. “However, the rapidly evolving competitive electricity market allows us to deliver commodity services and risk management products to our customers without requiring the ownership of a regulated electric utility.”
“We’re excited about this opportunity to transform our company by significantly expanding our scale and scope in this combination with PGE,” said Michael R. Niggli, chairman and CEO of Sierra Pacific Resources. “PGE is one of the premier electric utilities in the West, and this transaction is an important step in fulfilling our previously stated goal of expanding our regulated utility businesses. We look forward to using our regulated industry expertise to enhance the value of PGE’s businesses while continuing to provide safe, reliable electric service to customers. Moreover, the transaction will enable us to reinvest the proceeds from the planned divestiture of our Nevada generating assets.”
Credit Suisse First Boston and SG Barr Devlin acted as financial advisors, and Vinson & Elkins L.L.P. acted as legal counsel to Enron.
Sierra Pacific Resources is a holding company whose principal subsidiaries are Sierra Pacific Power Company and Nevada Power Company. Combined, the two utilities serve 843,000 electric customers in Nevada and the Lake Tahoe area of California, along with 105,000 natural gas and 67,000 water customers in Reno and Sparks, Nevada. More information about the company can be found at www.sierrapacific.com.
PGE is an electric utility serving more than 700,000 retail customers in northwest Oregon.
Enron is one of the world’s leading electricity, natural gas and communications companies. The company, which owns approximately $34 billion in energy and communications assets, produces electricity and natural gas, develops, constructs and operates energy facilities worldwide, delivers physical commodities and financial and risk management services to customers around the world, and is developing an intelligent network platform to facilitate online business. Enron’s Internet address is /corp. The stock is traded under the ticker symbol, “ENE.”
This press release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Enron believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Factors that could cause actual results to differ from those in the forward looking statements herein include Enron’s ability to satisfy customary closing conditions in the purchase and sale agreement and obtaining customary regulatory approvals.
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For additional information please contact:
Mark Palmer
(713) 853-4738
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