Allegheny Energy
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NEWS RELEASE
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800 Cabin Hill Drive, Greensburg, PA 15601-1689
Media contact: Investor contact:
Fred Solomon Max Kuniansky
Manager, Corporate Communications Executive Director, Investor Relations
Phone: (724) 838-6650 and Corporate Communications
Media Hotline: (888) 233-3583 Phone: (724) 838-6895
E-Mail: fsolomo@alleghenyenergy.com E-Mail: mkunian@alleghenyenergy.com
FOR IMMEDIATE RELEASE
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ALLEGHENY ENERGY OFFERS STOCK AND CASH FOR
CONVERTIBLE TRUST PREFERRED SECURITIES
GREENSBURG, PA., MARCH 23, 2005 - Allegheny Energy, Inc. (NYSE: AYE) today
announced the commencement of a tender offer and consent solicitation for
Allegheny Capital Trust I's 117/8% Mandatorily Convertible Trust Preferred
Securities due 2008.
$300 million (principal amount) of the 117/8% securities are currently
outstanding. Allegheny is offering holders of these securities 83.33 shares of
Allegheny Energy common stock and $160.00 in cash per $1,000.00 liquidation
amount if they agree to the conversion and consent to amend the indenture
governing Allegheny Energy's 117/8% notes.
"This tender offer furthers our goals of reducing debt and strengthening the
company's financial condition," said Paul J. Evanson, Chairman, President and
Chief Executive Officer of Allegheny Energy. "Conversion of these securities
will also accelerate the improvement of Allegheny Energy's equity ratio."
The tender offer commences today and is scheduled to expire at midnight, New
York City time, on April 20, 2005, unless extended or terminated. Specific
details of this offer are set forth in the offering circular and the
accompanying consent and letter of transmittal. For more information on the
offer and consent solicitation or to receive a copy of the offering circular,
contact Allegheny Energy's information agent, Global Bondholder Services
Corporation, at (212) 430-3774 or (866) 795-2200. Questions regarding
procedures for tendering in the offer and consent solicitation should be
directed to Allegheny Energy's conversion agent, Wilmington Trust Company, at
(302) 636-6470 or (800) 441-7120, Ext. 6740.
This press release is not an offer or solicitation for the early conversion of
the 117/8% securities (CUSIP No. 017271AA5) into common stock, which can only
be made on the terms and subject to the conditions described in the tender
offer statement (including an offering circular, a related letter of
transmittal and other offer documents) filed with the Securities and Exchange
Commission. The tender offer statement is being made available to all holders
of the securities at no expense to them. The tender offer statement is also
available at no charge on the SEC's Web site at www.sec.gov. The tender offer
statement contains important information that should be read carefully before
any decision is made with respect to the offer and consent solicitation.
Allegheny Energy
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Headquartered in Greensburg, Pa., Allegheny Energy is an investor-owned utility
consisting of two major businesses. Allegheny Energy Supply owns and operates
electric generating facilities, and Allegheny Power delivers low-cost, reliable
electric service to customers in Pennsylvania, West Virginia, Maryland,
Virginia and Ohio. For more information, visit our Web site at
www.alleghenyenergy.com.
Forward-Looking Statements
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In addition to historical information, this release contains a number of
"forward-looking statements" as defined in the Private Securities Litigation
Reform Act of 1995. Words such as anticipate, expect, project, intend, plan,
believe, and words and terms of similar substance used in connection with any
discussion of future plans, actions, or events identify forward-looking
statements. These include statements with respect to: regulation and the status
of retail generation service supply competition in states served by Allegheny
Energy's distribution business, Allegheny Power; financing plans; demand for
energy and the cost and availability of raw materials, including coal;
provider-of-last-resort and power supply contracts; results of litigation;
results of operations; internal controls and procedures; capital expenditures;
status and condition of plants and equipment; regulatory matters; and
accounting issues. Forward-looking statements involve estimates, expectations
and projections and, as a result, are subject to risks and uncertainties. There
can be no assurance that actual results will not materially differ from
expectations. Actual results have varied materially and unpredictably from past
expectations. Factors that could cause actual results to differ materially
include, among others, the following: changes in the price of power and fuel
for electric generation; general economic and business conditions; changes in
access to capital markets; complications or other factors that render it
difficult or impossible to obtain necessary lender consents or regulatory
authorizations on a timely basis; environmental regulations; the results of
regulatory proceedings, including proceedings related to rates; changes in
industry capacity, development and other activities by Allegheny Energy's
competitors; changes in the weather and other natural phenomena; changes in the
underlying inputs and assumptions, including market conditions used to estimate
the fair values of commodity contracts; changes in laws and regulations
applicable to Allegheny Energy, its markets or its activities; the loss of any
significant customers or suppliers; dependence on other electric transmission
and gas transportation systems and their constraints or availability; changes
in PJM, including changes to participant rules and tariffs; the effect of
accounting policies issued periodically by accounting standard-setting bodies;
and the continuing effects of global instability, terrorism and war. Additional
risks and uncertainties are identified and discussed in Allegheny Energy's
reports filed with the Securities and Exchange Commission.
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