WPS Resources Corporation and Peoples Energy Corporation Continue Making Progress Toward Completing Merger
09 Janeiro 2007 - 5:10PM
PR Newswire (US)
-- Agreement reached on resolution of issues with most intervening
parties in Illinois GREEN BAY, Wis., and CHICAGO, Jan. 9
/PRNewswire-FirstCall/ -- WPS Resources Corporation (NYSE:WPS)
("WPS Resources") and Peoples Energy Corporation (NYSE:PGL)
("Peoples") announced that they have made significant progress
toward obtaining the approvals needed to close their proposed
merger, including: -- On January 9, 2007, WPS Resources and Peoples
reached agreement with most of the interveners on the contested
issues in the merger application pending before the Illinois
Commerce Commission. The agreement is between the companies and the
City of Chicago, the Cook County State's Attorney's Office, the
Attorney General of the State of Illinois, the Citizens Utility
Board, the Environmental Law and Policy Center, the Utility Workers
Union of America, AFL-CIO, and UWUA Local Union No. 18007 (UWUA
Local 18007). The Staff of the Illinois Commerce Commission, which
as a general rule does not join in settlement agreements, has
signed the agreement to indicate that Staff has no objection to and
will not oppose the terms of the agreement. The agreement is
memorialized in documents filed today with the Illinois Commerce
Commission. Discussions continue with the remaining intervening
parties. All agreements must be presented to and are subject to
approval by the Illinois Commerce Commission. -- On December 21,
2006, the Federal Energy Regulatory Commission approved the merger
transaction. -- On December 6, 2006, the shareholders of WPS
Resources and Peoples voted overwhelmingly to approve the
completion of the merger. "We are pleased that our efforts to
complete this merger have been well received by the Federal Energy
Regulatory Commission, shareholders, and the communities in which
we operate," stated Larry L. Weyers, Chairman, President and CEO of
WPS Resources. Weyers will become President and CEO of Integrys
Energy Group, Inc., the new name for the combined companies when
the merger is completed. "We are grateful to the parties for their
cooperation in this agreement. We will continue to work on
resolving issues in Illinois and Wisconsin. We continue to be
hopeful of obtaining all the necessary regulatory approvals to
close the merger during the first quarter of 2007." A summary of
major components of the Illinois agreement are as follows: --
Inclusion of Synergy Savings and Costs to Achieve in Customer Rates
In the rate cases to be filed by Peoples Gas and North Shore Gas in
2007, the companies will use historical test years ended September
30, 2006, with adjustments for "known and measurable changes"
through September 30, 2007. There will be adjustments for "known
and measurable changes" for merger related annual synergy savings
totaling about $13 million. Peoples Gas' and North Shore Gas'
recovery of merger-related costs incurred to achieve the synergy
savings will be capped at about $45 million. The estimate of such
costs provided in testimony filed previously with the Illinois
Commerce Commission was about $47 million. Of this amount, about
$35 million will be recovered through an annual cost recovery of
about $7 million which will be provided through a five-year
amortization period included in the 2007 rate case. The remaining
costs, to the extent actually incurred, will be eligible for
recovery through rates established in a future rate case. --
Service-Related Proposals Peoples Gas and North Shore Gas will
conduct certain operational studies proposed by Illinois Commerce
Commission Staff to assist in improving customer service. -- Energy
Efficiency Programs and Funding In their next rate cases, Peoples
Gas and North Shore Gas will propose energy efficiency programs
with an aggregate cost of $7.5 million per year. It is anticipated
the companies will not be obligated to fund these programs beyond
the amount for which the Illinois Commerce Commission provides cost
recovery in the rate case orders. -- Utility Workers Union of
America, AFL-CIO, and UWUA Local No. 18007 Peoples Gas commits
there will be no reorganization-related layoffs or
reorganization-related position reductions among the UWUA Local
18007 employees. In addition, there will be a specific limited
number of position upgrades and additions to the current union work
force levels. About WPS Resources Corporation WPS Resources
(NYSE:WPS), based in Green Bay, Wisconsin, is a holding company
with five major subsidiaries providing electric and natural gas
energy and related services in both regulated and non-regulated
energy markets. Its largest subsidiary is Wisconsin Public Service
Corporation, a regulated electric and natural gas utility serving
northeastern Wisconsin and a portion of Michigan's Upper Peninsula.
Wisconsin Public Service serves more than 425,000 electric
customers and 308,000 natural gas customers. Minnesota Energy
Resources Corporation is a regulated natural gas utility serving
more than 200,000 customers throughout Minnesota. Michigan Gas
Utilities Corporation is a regulated natural gas utility serving
161,000 customers in lower Michigan. Another subsidiary, Upper
Peninsula Power Company, is a regulated electric utility that
serves approximately 52,000 electric customers in Michigan's Upper
Peninsula. WPS Resources' major non-regulated subsidiary consists
of WPS Energy Services, Inc., a diversified non-regulated energy
supply and services company serving commercial, industrial and
wholesale customers and aggregated groups of residential customers.
Its principal market is the northeast quadrant of the United States
and adjacent portions of Canada. Its principal operations are in
Illinois, Maine, Michigan, Ohio, Texas, Virginia, and Wisconsin in
the United States and Alberta, Ontario, and Quebec in Canada. WPS
Energy Services also owns and/or operates non-regulated electric
generation facilities in Wisconsin, Maine, Pennsylvania, New York,
and New Brunswick, Canada; steam production facilities in Arkansas
and Oregon; and a partial interest in a synthetic fuel processing
facility in Kentucky. Visit the WPS Resources Web site at
http://www.wpsr.com/ for additional information. About Peoples
Energy Peoples Energy, (NYSE:PGL) a member of the S&P 500, is a
diversified energy company consisting of three primary business
segments: Gas Distribution, Oil and Gas Production, and Energy
Marketing. Peoples Gas and North Shore Gas, regulated utilities,
deliver natural gas to about one million customers in the City of
Chicago and 54 communities in northeastern Illinois. The company's
non-utility businesses include Peoples Energy Services (PESC) and
Peoples Energy Production (PEP). PESC, launched in 1996, serves
more than 40,000 customers, providing a portfolio of products to
manage the energy needs of business, institutional and residential
consumers. PEP is primarily engaged in the acquisition and
development of proven onshore natural gas reserves with upside
potential in a limited number of strategic supply basins. Value is
then added through drilling programs, production enhancements and
reservoir optimization. Visit Peoples' website at
http://www.peoplesenergy.com/ for more information. Forward-Looking
Statements This press release contains forward-looking statements
within the meaning of Section 21E of the Securities Exchange Act of
1934. You can identify these statements by the fact that they do
not relate strictly to historical or current facts and often
include words such as "anticipate," "expect," "intend," "may,"
"could," "project," "believe" and other similar words.
Forward-looking statements are beyond the ability of WPS Resources
and Peoples Energy to control and, in many cases, neither WPS
Resources nor Peoples Energy can predict what factors would cause
actual results to differ materially from those indicated by
forward-looking statements. Please see WPS Resources' and Peoples
Energy's periodic reports filed with the Securities and Exchange
Commission (including their 10-Ks and 10-Qs) for listings of
certain factors that could cause actual results to differ
materially from those contained in forward-looking statements. All
forward-looking statements included in this press release are based
upon information presently available, and neither WPS Resources nor
Peoples Energy assume any obligation to update any forward-looking
statements. DATASOURCE: WPS Resources Corporation CONTACT:
Investors, Joseph P. O'Leary, Senior Vice President and Chief
Financial Officer, +1-920-433-1463, or Donna M. Sheedy, Manager
Investor Relations, +1-920-433-1857, or Media, Thomas P. Meinz,
Executive Vice President - Public Affairs, +1-920-433-1293, all of
WPS Resources Corporation, or Investors, Thomas Nardi, Executive
Vice President and Chief Financial Officer, +1-312-240-7152, or
Douglas Ruschau, Vice President, Finance and Treasurer,
+1-312-240-3818, or Media, Rod Sierra, Vice President,
Communications and Government Relations, +1-312-240-4567, all of
Peoples Energy Corporation Web site: http://www.wpsr.com/
http://www.peoplesenergy.com/
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