EXHIBIT 20
FOR IMMEDIATE RELEASE
NORTHWESTERN TO ACQUIRE MONTANA POWER'S
ENERGY DISTRIBUTION BUSINESS FOR $1. 1 BILLION
Sioux Falls, S.D. -- October 2, 2000 -- NorthWestern Corporation (NYSE:NOR), a
$5 billion diversified services and solutions company, announced today that it
has entered into a definitive agreement under which NorthWestern will acquire
The Montana Power Company's (NYSE:MTP) energy distribution and transmission
business for approximately $1.1 billion in cash, including approximately $488
million in existing Montana Power debt. The transaction will be accounted for as
a purchase and is expected to be accretive to NorthWestern's earnings per share
upon its completion. NorthWestern anticipates that the transaction will close in
the first half of 2001.
The Montana Power assets include regulated electric and natural gas distribution
and transmission operations -- and certain unregulated, energy-related
businesses that provide products and services to industrial, institutional and
commercial customers.
NorthWestern is one of the leading services and solutions providers in North
America, serving more than two million energy and communications customers
nationwide. The company's revenues have risen from $200 million to $5 billion
over the past five years, and this transaction represents another significant
step in NorthWestern's growth strategy. This acquisition will extend the
company's service offerings to an additional 439,000 electric and natural gas
customers in Montana and enhance its ability to reach out to new customers in
the western United States.
(MORE)
NorthWestern anticipates additional benefits from the transaction, including:
- - Improved strategic positioning and a platform to capitalize on future
regional growth opportunities within the energy industry,
- - Expansion of the company's annual energy revenues by more than $590
million,
- - A strong earnings stream and robust cash flow,
- - An accretive earnings effect that accelerates NorthWestern's targeted
double-digit growth.
"We are very excited to announce this strategic transaction with Montana Power,"
said Merle D. Lewis, chairman and chief executive officer of NorthWestern
Corporation. "Joining with another dynamic company in our region positions us
for success in the new energy marketplace. Montana Power is a company whose
customer-focused values we embrace, and whose 87-year history is a fundamental
part of Montana's legacy."
Lewis continued, "Montana Power serves an area with similar service
characteristics to NorthWestern's, and has a record of providing outstanding
customer care. This transaction creates benefits for all our stakeholders
customers, employees, communities and shareholders alike - and strategically
positions us to be a leading energy transmission and distribution company in the
region."
"NorthWestern and Montana Power are proud of our outstanding workforce, an
exceptional work ethic and a drive to succeed in the changing, consolidating
energy industry", said Richard R. Hylland, president and chief operating officer
of Northwestern. "We are delighted to welcome the Montana Power team into the
NorthWestern family and look forward to working together to achieve
extraordinary growth and success for our customers."
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"This agreement brings together two companies with decades of experience in
serving the needs of energy customers in the northern tier states," said Bob
Gannon, Montana Power's chairman and chief executive officer. "In evaluating
potential bidders, we said we would examine a broad range of factors, including,
but not limited to, financial strength, operating experience to preserve
reliable electricity and natural gas service, reputation for fair dealing with
customers and employees, and the ability to finalize any transactions.
NorthWestern's stellar track record and reputation clearly meets our objectives.
We are confident that Montana Power customers, employees and the communities we
serve will benefit from exciting new opportunities with this dynamic, growing
company."
Montana Power currently serves more than 288,000 electric and 151,000 natural
gas customers in a 107,000-square-mile area in central and western Montana. This
area contains more than 86 percent of the state's population, in addition to
major commercial, manufacturing and recreational areas, including Helena, Butte,
Billings, Missoula, Great Falls, Bozeman and Yellowstone National Park. Upon
completion of the transaction, NorthWestern will distribute natural gas and
electricity to more than 575,000 customers in Montana, South Dakota, and
Nebraska.
The combined electric distribution and transmission system will consist of more
than 20,000 miles of electric lines and associated terminal facilities. The
combined natural gas distribution system will include over 5,000 miles of
pipelines. Through these systems, NorthWestern will have the capacity to provide
energy to wider regions of the country.
Additionally, Montana Power's strategically located natural gas pipelines will
provide NorthWestern access to competitively-priced Canadian gas supply and
interconnections with four major pipeline companies: NOVA, Havre Pipeline
Company, Williston Basin Interstate Pipeline Company and Colorado Interstate Gas
Company.
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"Customers across the state of Montana will continue to receive the same great
service from the same great people at all hours in any weather," said Michael J.
Hanson, president and chief executive officer of NorthWestern Public Service,
the company's electric and gas distribution entity. "We are also committed to
working towards competitive and stable energy rates for our energy customers
while maintaining the highest levels of reliability and customer satisfaction.
"NorthWestern Corporation was ranked the No. 1 energy company on FORTUNE
magazine's Most Admired Companies list," added Hanson. "We believe our company's
success results from living and working by our SPIRIT values -- service
excellence, performance, integrity, respect, innovation and teamwork -- and we
will continue to be guided by these values in every community as we pursue
future growth for the benefit of our customers."
"We also recognize that our people are our most important asset, and we are
excited about the new opportunities for professional growth and advancement this
transaction will create for employees of Montana Power and NorthWestern," Hanson
continued. "Based on the similar cultures and shared values of our two
organizations, we anticipate a smooth integration that combines the best
practices of both companies as we serve customers throughout the region."
NorthWestern expects to maintain the Butte headquarters of Montana Power's
energy distribution businesses and, under the terms of the agreement, the
company will continue to operate under the "The Montana Power Company" name in
the state of Montana. NorthWestern intends to draw on the existing skills and
experience within both organizations to enhance its already superior level of
customer service.
The transaction is subject to certain conditions, such as receipt of regulatory
approvals, including a determination of the Montana Public Service Commission,
the Federal Energy Regulatory Commission, and any necessary antitrust
determinations -- and the approval of Montana Power's shareholders. The
acquisition is fully financed and, therefore, is not subject to a financing
condition.
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Credit Suisse First Boston acted as financial advisor, and Paul, Hastings
Janofsky & Walker LLP acted as legal counsel to NorthWestern. Goldman, Sachs &
Co. acted as financial advisor, and Millbank, Tweed, Hadley & McCloy LLP acted
as legal counsel to Montana Power.
About NorthWestern
NorthWestern Corporation and its partner entities are leading providers of
services and solutions to more than two million customers across America in the
communications and energy sectors. NorthWestern's partner entities include
Expanets, the largest U.S. mid-market provider of networked communications
solutions and services; Blue Dot-Registered Trademark-, a national provider of
air conditioning, heating, plumbing and related services; CornerStone Propane
Partners, L.P. (NYSE: CNO), the nation's fifth largest retail propane
distribution entity; and NorthWestern Public Service, a provider of electric,
natural gas and communication services to Midwestern customers. Further
information about NorthWestern is available on the Internet at
http://www.northwestern.com.
About Montana Power Company
The Montana Power Company is a diversified investor-owned electric and natural
gas distribution entity with nonregulated businesses in coal, oil and natural
gas, and independent power production, and telecommunications. The company
announced on March 28, 2000 that it would divest all of its energy businesses,
including its electric and natural gas distribution operations, and invest the
proceeds in telecommunications under Touch America. On September 20, 2000,
Montana Power announced that BBI Power Corporation will acquire its independent
power business. On August 28, the company announced that PanCanadian Petroleum
Limited of Calgary is acquiring its oil and gas properties, and on September 15,
the company announced that Westmoreland Coal Company of Colorado Springs is
purchasing its coal business. Touch America is a wholly-owned fiber-optic and
wireless data transport telecommunications subsidiary of Montana Power,
providing national long distance, private line, Internet, and business telephone
equipment products and services. The company's digital fiber optic network,
which will reach 26,000 route miles nationally by year-end 2001, employs the
most advanced telecommunications technology available today. Touch America and
The Montana Power Company are based in Butte, Mont. Information about Montana
Power can be found at http://www.mtpower.com.
Forward-looking Language
This press release contains certain forward-looking statements within the
meaning of the safe-harbor provisions of the Securities Exchange Act of 1934;
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. 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, the terms associated with
obtaining regulatory approvals, 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 press
release. 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 this press release.
(MORE)
Additional Information
In connection with the proposed transaction, Montana Power will file a
definitive Proxy Statement with the Securities and Exchange Commission (SEC).
INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE DEFINITIVE PROXY
STATEMENT WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. Investors and security holders may obtain a free copy of the
definitive Proxy Statement (when available) and other documents filed by
NorthWestern and Montana Power with the SEC at the Commission's web site at
http://www.sec.gov. Free copies of the definitive Proxy Statement, once
available, and each company's other filings with the SEC may also be obtained
from the respective companies. Free copies of NorthWestern's filings may be
obtained by directing a request to NorthWestern Corporation, 125 S. Dakota Ave.,
Sioux Falls, SD 57104. Telephone: (605) 978-2908. Free copies of Montana Power's
filings may be obtained by directing a request to The Montana Power Company, 40
East Broadway, Butte, MT 59701. Telephone: (406) 497-3000.
Financial Analyst Teleconference:
There will be a financial analyst conference call today at 9 a.m. EDT to discuss
the transaction. The live and on-demand webcast of the call will be available
online at www.streetfusion.com, as well as www.northwestern.com.
Satellite Uplink for B-roll
Monday, October 2, 2000 Monday, October 2, 2000
8:00 to 8:30 am EDT 12:00 to 12:30 pm EDT
Telstar 4; Transponder 6 C-Band Telstar 4; Transponder 6 C-band
Downlink frequency 3820 horizontal Downlink frequency 3820 horizontal
If you have any technical questions or problems with the satellite feed for
B-roll, please call Brett Curran at (212) 627-5622.
Contact Information:
Contacts for NorthWestern Contacts for Montana Power
Investors: Investors:
Rogene Thaden Linda McGillen
605-978-2904 406-496-5211
rogene.thaden@northwestern.com lmcgillen@mtpower.com
Media: Media:
Paul Wyche Cort Freeman
605-978-2856 406-496-2368
paul.wyche@northwestern.com cfreeman@mtpower.com
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