SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 7, 1999
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(October 6, 1999)
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PUBLIC SERVICE COMPANY OF NEW MEXICO
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(Exact Name of Registrant as Specified in its Charter)
Commission
New Mexico File Number 1-6986 85-0019030
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(State or Other Jurisdiction (I.R.S. Employer
of Incorporation) Identification Number)
Alvarado Square, Albuquerque, New Mexico 87158
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(Address of Principal Executive Offices) (Zip Code)
(505) 241-2700
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(Registrant's Telephone Number, Including Area Code)
(Former Name or Former Address if Changed, Since Last Report)
Item 5. Other Event
The following is an article disclosed in the Company's news release dated on
October 6, 1999, and is being filed herewith as a current event.
"PNM Board Approves Filing Holding Company Plan
ALBUQUERQUE, NM, October 6 - The Board of Directors of PNM, the Public Service
Company of New Mexico (NYSE:PNM), has approved management's plans for splitting
the present integrated electric and gas utility into two separate, wholly-owned
subsidiaries under a holding company, PNM Chairman and Chief Executive Officer
Benjamin Montoya said today.
"The transition to a competitive retail electric power market in New Mexico
requires us to separate our regulated utility operations from our competitive
power generation and energy services businesses," Montoya said. "This new
holding company structure will comply with that requirement."
PNM now has a capital structure underpinned by about 53 percent debt and 47
percent shareholders' equity. PNM's regulated electric and gas transmission and
distribution systems comprise about 47 percent of the company's total assets and
contributed 41 percent of total operating revenues and 49 percent of the
company's income before interest charges last year. The company expects that
these assets will be transferred to a newly-created subsidiary corporation at
book value.
Under PNM's proposal, the company's generation assets will be retained by the
existing corporation. Those assets include a 47 percent interest in the
1,614-megawatt San Juan Generating Station in New Mexico, as well as minority
interests in Palo Verde Nuclear Generating Station in Arizona and the coal-fired
Four Corners Power Plant in New Mexico. Approximately $586 million in pollution
control revenue bonds will remain as an obligation of the generation subsidiary.
Power generation will remain an important part of PNM's business in coming
years, Montoya said. "We expect that in 1999, for the third year in a row, our
wholesale power sales will exceed our retail electric sales," Montoya noted.
"Over the next few years, PNM plans to make a substantial investment in building
or acquiring new generating assets to support continued growth in our wholesale
trading operation."
PNM plans to file a request with the New Mexico Public Regulation Commission to
establish the new holding company and its separate, wholly-owned subsidiary
companies. This filing is expected to be made before March 1, 2000.
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The names PNM and Public Service Company of New Mexico will be transferred to
the new transmission and distribution company, Montoya said. "PNM is the name
our New Mexico customers have come to rely on for dependable, affordable
electric and gas service for more than 50 years. We believe it is important to
preserve that familiar identity as our industry changes so dramatically." No
name has yet been chosen for the new holding company or the competitive
generation subsidiary.
Statements made in this news release that relate to future events are made
pursuant to the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based upon current expectations and the company
assumes no obligation to update this information. Because actual results may
differ materially from expectations, the company cautions readers not to place
undue reliance on these statements. Changes in interest rates, trends in the
local and national economy, energy supply and demand, federal and state
regulatory activity, and the transition to a competitive electric market in New
Mexico may all have an impact on PNM's financing plans, operating performance,
and future profitability. For a more detailed discussion of these and other
important factors affecting PNM, please see "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the Company's Form
10-K for the year ended December 31, 1998 and the Form 10-Q for the quarter
ended June 30, 1999."
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PUBLIC SERVICE COMPANY OF NEW MEXICO
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(Registrant)
Date: October 7, 1999 /s/ John R. Loyack
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John R. Loyack
Vice President, Corporate Controller
and Chief Accounting Officer
(Officer duly authorized to
sign this report)
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