Entergy and Shaw Sign Definitive Agreement to Create Premier Engineering,
Procurement, Construction and Power Plant Commissioning Company
BATON ROUGE, La. - Entergy Corporation (NYSE:ETR) and The Shaw Group Inc.
(NYSE:SGR) announced that today Entergy's non-utility wholesale operating group
and Shaw will sign a definitive agreement creating EntergyShaw, L.L.C., a new
company that will provide management, engineering, procurement, construction and
commissioning services to build electric power plants worldwide. On June 2,
Entergy and Shaw announced the signing of a letter of intent to form the new
company.
EntergyShaw will be headquartered in Baton Rouge, La. Entergy and Shaw each own
a 50 percent interest in the new company. Jim Earley, a senior vice president of
Shaw, has been appointed president.
EntergyShaw will be strategically positioned to meet growing demand in the
global power generation market. Its initial focus will be on projects related to
the execution of Entergy Wholesale Operations' power development plans in North
America and Europe, which includes its previously announced gas turbine rollout
program. Entergy's wholesale operating group is the power development, marketing
and trading business unit of Entergy. Over the next several years, the new
venture is expected to manage the construction of multiple power projects, the
total capital value of which could exceed $6 billion. The actual number of
projects undertaken will be subject to the approval of the new company's
management committee.
Subsequent to the announcement of the companies' plans to form the venture, EWO
and Shaw commenced development of a standardized market-driven reference plant
design. This design, which is expected to be replicated in each of the
EntergyShaw projects, is anticipated to reduce power plant construction,
commissioning and operating costs by as much as 10 to 15 percent on average.
Earley stated, "We are very excited to finalize this agreement, which will allow
us to fully join forces for the development of power generation capacity
worldwide. Our reference plant design is well underway, and we have identified
key members for the EntergyShaw team who will play a significant role in
successfully executing our strategy."
Geoff Roberts, president and chief executive officer of Entergy Wholesale
Operations, stated, "EntergyShaw provides a critical component to our successful
power development efforts. Shaw's expertise in engineering and construction,
coupled with Entergy's business development and operations skills, will make for
an unbeatable combination."
J. M. Bernhard Jr., Shaw's chairman, president and chief executive officer,
stated, "The efforts put forth by Entergy and Shaw to consummate this venture
are a clear indication of the confidence and enthusiasm that exists between our
two organizations. What was already a great combination of capabilities and
resources has the potential to be even further enhanced through ongoing
developments in our respective companies."
U.S. Senator John Breaux, (D-Louisiana), commented, "This new venture brings
together two great Louisiana companies that signals good news not only for the
work force in our state, but also the Louisiana economy as a whole."
Background on the Parent Organizations
Entergy owns, manages or invests in power plants generating nearly 30,000
megawatts of electricity domestically and internationally and delivers
electricity to about 2.5 million customers in portions of Arkansas, Louisiana,
Mississippi and Texas. Entergy is a major global energy company engaged in power
production, distribution operations, and related diversified services, with more
than 12,000 employees. It is also a leading provider of wholesale energy
marketing and trading services. The Entergy futures contract on the New York
Mercantile Exchange (NYMEX) is one of the largest electricity trading points in
the United States.
The Shaw Group Inc. is the world's only vertically-integrated provider of
complete piping systems and comprehensive engineering, procurement and
construction services to the power generation industry. Shaw is the largest
supplier of fabricated piping systems in the United States and a leading
supplier worldwide, having installed piping systems in power plants with an
aggregate generation capacity in excess of 200,000 megawatts. While
approximately 65 percent of Shaw's backlog at August 31 was attributable to the
power generation industry, the company also does work in the process industries,
including petrochemical, chemical and refining, and the environmental and
infrastructure sector. The company currently has offices and operations in North
America, South America, Europe, the Middle East and Asia-Pacific, and has more
than 13,000 employees.
Entergy's online address is www.entergy.com
The Shaw Group's online address is www.shawgrp.com
The following constitutes a "Safe Harbor" statement under the Private Securities
Litigation Reform Act of 1995: Investors are cautioned that forward-looking
statements contained in the foregoing release with respect to the revenues,
earnings, performance, strategies, prospects and other aspects of the business
of Entergy Corporation and The Shaw Group may involve risks and uncertainties.
Actual events and results may, for a variety of reasons, prove to be materially
different from those indicated in these forward-looking statements, estimates
and projections. Factors that could influence actual future outcomes include
regulatory decisions, the effects of changes in law, the evolution of markets
and competition, changes in economic conditions, changes in accounting, weather,
the performance of generating units, fuel prices and availability, financial
markets, risks associated with businesses conducted in foreign countries,
changes in business plan, the presence of competitors with greater financial
resources and the impact of competitive products and pricing; the effect of the
Entergy Corporation's and The Shaw Group's policies, including the amount and
rate of growth of Entergy Corporation's and The Shaw Group's expenses; the
continued availability to Entergy Corporation and The Shaw Group of adequate
funding sources and changes in interest rates; delays or difficulties in the
production, delivery or installation of products and the provision of services;
and various legal, regulatory and litigation risks. Entergy Corporation and The
Shaw Group undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. For a more detailed discussion of some of the foregoing
risks and uncertainties, see Entergy Corporation's and The Shaw Group's filings
with the Securities and Exchange Commission.