[NiSOURCE LOGO] [COLUMBIA ENERGY GROUP LOGO]
NEWS RELEASE
CONTACTS:
MEDIA
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NiSource - Sally A. Anderson (219) 647-6203
Columbia - R.A. Rankin, Jr. (703) 561-6044
INVESTOR RELATIONS
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NiSource - Dennis Senchak (219) 647-6085
Columbia - Melissa Bockelmann (703) 561-6011
NISOURCE, COLUMBIA ENERGY GROUP SEEK FERC APPROVAL OF MERGER
JOINT PETITION REQUESTS DECISION BY JULY 31
MERRILLVILLE, Ind., and HERNDON, Va. (April 12, 2000)--NiSource Inc.
(NYSE: NI) and Columbia Energy Group (NYSE: CG) today announced they have filed
a joint application with the Federal Energy Regulatory Commission (FERC) seeking
necessary approvals of their planned merger under the Federal Power Act (FPA).
The NiSource/Columbia merger satisfies the requirements of the FPA and
the standards defined in the FERC's Merger Policy Statement in that it will not
adversely affect competition, impair the effectiveness of regulation, or cause
increases in the rates paid by wholesale electric or transmission customers,
according to the filing. The joint application requests a decision by July 31, a
time period consistent with other recent FERC merger approvals under the FPA.
The NiSource/Columbia transaction, announced February 28, is expected
to close by the end of the year. The combined company will serve more than 4.1
million customers primarily located in nine states. Its operations will span the
high-growth energy corridor extending from the Gulf of Mexico to New England,
creating the largest natural gas distributor east of the Rockies, with wholesale
and retail electric operations.
"Today's filing is our next step toward creating a super-regional
enterprise with access to strategic and operational opportunities that would not
be available to us as separate companies," said Gary L. Neale, NiSource
chairman, president and chief executive officer. "Together, we will have three
elements that are key to success in the increasingly deregulated and competitive
energy marketplace: increased size, scope and scale; access to strategic
geographic markets, and a broad range of complementary assets."
Oliver G. Richard III, chairman, president and chief executive officer
of Columbia Energy Group, said, "We are enthusiastic about the value the merger
will bring to our shareholders, customers and the communities we serve. The
combination provides a powerful platform for growth."
-more-
NiSource/Columbia Seek FERC Approval--2
The principal subsidiary of NiSource that is subject to FERC
jurisdiction under the FPA is Northern Indiana Public Service Company (NIPSCO).
NIPSCO generates and distributes electricity to about 426,000 customers
in 30 counties in northern Indiana, owns and operates four coal-fired generating
stations, two hydroelectric generating plants and four gas-fired combustion
turbine generating units, providing a total system net capability of 3,392
megawatts. NIPSCO's electric retail rates and services in Indiana will continue
to be regulated by the Indiana Utility Regulatory Commission following the
merger, according to the filing.
The only Columbia subsidiary subject to FPA jurisdiction is Columbia
Energy Power Marketing (CEPM) Corporation.
The NiSource/Columbia application gives an independent analysis of the
potential competitive impacts of their proposed merger by an economic expert.
The analysis concludes that combining the companies will not adversely impact
competition in any relevant product and geographic markets.
Current FERC and state regulatory jurisdiction over the companies'
subsidiaries also will remain unchanged following the merger, according to the
filing.
NiSource is a holding company with headquarters in Merrillville, Ind.,
whose primary business is the distribution of electricity, natural gas and water
in the Midwest and Northeastern United States. The company also markets utility
services and customer-focused resource solutions along a corridor from Texas to
Maine. More information about the company is available on the Internet at
http://www.nisource.com.
Columbia Energy Group, based in Herndon, Va., is one of the nation's
leading energy services companies, with assets of approximately $7 billion. Its
operating companies engage in virtually all phases of the natural gas business,
including exploration and production, transmission, storage and distribution, as
well as retail energy marketing, propane and petroleum product sales, and
electric power generation. More information about Columbia is available on the
Internet at http://www.columbiaenergygroup.com.
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This release contains forward-looking statements within the meaning of
the federal securities laws. These forward-looking statements are subject to
various risks and uncertainties. The factors that could cause actual results to
differ materially from the projections, forecasts, estimates and expectations
discussed herein may include factors that are beyond the companies' ability to
control or estimate precisely, such as estimates of future market conditions,
the behavior of other market participants, and the actions of the federal and
state regulators.
-more-
NiSource/Columbia Seek FERC Approval--3
Other factors include, but are not limited to, actions in the financial
markets, weather conditions, economic conditions in the two companies' service
territories, fluctuations in energy-related commodity prices, conversion
activity, other marketing efforts and other uncertainties. Other risk factors
are detailed from time to time in the two companies' SEC reports. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date of this document. The companies do not undertake any
obligation to publicly release any revisions to these forward-looking statements
to reflect events or circumstances after the date of the document.
NiSource and the new holding company have filed a registration
statement, which contains a joint proxy statement/prospectus of NiSource and
Columbia, and other documents with the Securities and Exchange Commission.
Investors and security holders are urged to read the joint proxy
statement/prospectus and any other relevant documents filed with the SEC because
they contain important information. Investors and security holders are able to
receive the final joint proxy statement/prospectus and other documents free of
charge at the SEC's web site, http://www.sec.gov, from NiSource at its web site,
http://www.nisource.com, or from Columbia at its web site,
http://www.columbiaenergygroup.com. Information concerning the identity of the
participants in the solicitation of proxies by the NiSource Inc. and Columbia
Energy Group boards of directors and their direct or indirect interest, by
security holdings or otherwise, may be obtained from the Secretary of NiSource
Inc. or the Secretary of Columbia Energy Group at the respective addresses
listed above.