SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTIONS 13 OR 15(D) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 30, 1999
Commission Registrant, I.R.S. Employer
File Number State of Incorporation Identification Number
Address and Telephone
Number
1-13895 Conectiv 51-0377417
(a Delaware Corporation)
800 King Street
P.O. Box 231
Wilmington, Delaware 19899
Telephone (302) 429-3114
1-1405 Delmarva Power & Light Company 51-0084283
(a Delaware and Virginia Corporation)
800 King Street
P.O. Box 231
Wilmington, Delaware 19899
Telephone (302) 429-3114
1-3559 Atlantic City Electric Company 21-0398280
(a New Jersey Corporation)
800 King Street
P.O. Box 231
Wilmington, Delaware 19899
Telephone (302) 429-3114
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Item 5. OTHER EVENTS
As previously reported, Conectiv (the Company) and its
subsidiaries Delmarva Power & Light Company (DPL) and Atlantic
City Electric Company (ACE) have been considering the possible
sale of DPL and ACE interests in nuclear and non-strategic
baseload fossil electric generating plants. On September 30, 1999,
the Company announced that DPL and ACE had reached agreements to
sell their ownership interests in three nuclear plants to PSEG
Power LLC and PECO Energy Company (PECO). The ownership interests
will be sold for approximately $20 million, plus reimbursement of
actual fuel inventory at closing.
All of the Company's nuclear interests will be sold as a result of
the agreements:
* A 15-percent interest (328 megawatts) in the Peach Bottom Atomic
Power Station Units 2 and 3 will be sold in equal shares to PSEG
Power LLC, a subsidiary of Public Service Enterprise Group
Incorporated (PSEG) and PECO. Each of PSEG and PECO presently
owns about 43%. PECO is the operator of that facility.
* A 14.8-percent interest (328 megawatts) in the Salem Nuclear
Generation Station Units 1 and 2 will be sold to PSEG Power LLC.
PSEG presently owns about 43% interest in and is operator of
that facility.
* A five-percent interest (52 megawatts) in the Hope Creek Nuclear
Generating Station also will be sold to PSEG Power LLC. PSEG
presently owns the other 95 percent of Hope Creek and operates
the facility.
According to the agreements, PSEG Power LLC and PECO will assume
full responsibility for the ultimate decommissioning of Peach
Bottom, Salem and Hope Creek. The sales are expected to close by
mid-2000 and are subject to the receipt of various federal and
state regulatory approvals.
On September 30, 1999, the Company issued a press release related
to the sale of the nuclear power plants, a copy of which has been
filed as an exhibit to this report and is incorporated by
reference herein.
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Item 7(c) Exhibit
99.1 Press Release issued by Conectiv dated September 30, 1999.
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SIGNATURE
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 hereunto duly authorized.
CONECTIV
Delmarva Power & Light Company
Atlantic City Electric Company
Date: October 7, 1999 /s/Philip S. Reese
Treasurer
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EXHIBIT INDEX
EXHIBIT DESCRIPTION PAGE
NUMBER
99.1 Press Release issued by Conectiv
dated September 30, 1999.
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Exhibit 99.1
FOR IMMEDIATE RELEASE
September 30, 1999
For information, contact:
Conectiv: Mary Rucci, (302) 429-3334
PSEG Power: Kathy Ellis (973) 430-6618
PECO: Bill Jones (215) 841-4129
CONECTIV TO SELL INTERESTS IN NUCLEAR PLANTS
TO PSEG POWER AND PECO ENERGY
Wilmington, De. - Conectiv (NYSE:CIV), an energy and vital
services provider serving the Mid-Atlantic region, today announced
it has reached agreements to sell ownership interests in three
nuclear plants to PSEG Power LLC (PSEG Power) and PECO Energy
Company (PECO). The ownership interests will be sold for
approximately $20 million, plus reimbursement of actual fuel
inventory at closing, subject to receipt of various federal and
state regulatory approvals.
All of Conectiv's nuclear interests will be sold as a result of
the agreements:
* A 15-percent interest (328 megawatts) in the Peach Bottom Atomic
Power Station Units 2 and 3 will be sold in equal shares to co-
owners PSEG and PECO, each of which presently owns about 43%.
PECO is the operator of that facility.
* A 14.8-percent interest (328 megawatts) in the Salem Nuclear
Generation Station Units 1 and 2 will be sold to PSEG Power, a
subsidiary of Public Service Enterprise Group Incorporated
(PSEG), which presently owns about 43% interest in and is
operator of that facility.
* A five-percent interest (52 megawatts) in the Hope Creek Nuclear
Generating Station also will be sold to PSEG Power. PSEG
presently owns the other 95 percent of Hope Creek and operates
the facility.
According to the agreements, PSEG Power and PECO will assume full
responsibility for the ultimate decommissioning of Peach Bottom,
Salem and Hope Creek. The sales are expected to close by mid-2000.
"This sale moves Conectiv closer to its goal of focusing on a
mid-merit generation strategy," said Tom Shaw, Executive Vice
President of Energy Supply, who noted that the electricity
produced from the three stations will continue to be available for
customers in the region that the companies serve. Shaw continued,
"A long-term benefit of these sales to Conectiv is reducing the
financial risk associated with a minority ownership in nuclear
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plants. As the industry restructures, larger utilities
strategically focused on nuclear generation will be better
positioned to assume these risks."
Shaw noted that in keeping with its mid-merit generation strategy,
Conectiv plans to announce the buyers of its baseload fossil fuel
plants later this year. Conectiv is developing a generation
portfolio of mid-merit plants that are able to follow the market
peaks, he noted, and recently announced its plans to build a new
500-megawatt combustion turbine/combined cycle plant at its Hay
Road/Edge Moor complex in New Castle County, Delaware.
"This is one in a series of growth steps on the road to further
positioning PSEG Power as a player in the regional energy
market," said Frank Cassidy, president PSEG Power "The
opportunities are out there and, as we did in this case, we intend
to evaluate and acquire additional generation that enhances our
portfolio and adds value to our bottom line."
Jerry Rainey, president of PECO Nuclear, said the purchase of 7.5
percent ownership of Peach Bottom, bringing PECO Energy's
ownership share to 50 percent, fits well with the company's
strategic business objective to increase its nuclear generation
portfolio. "Peach Bottom is an excellent, high capacity plant,"
Rainey said. "We welcome ownership of the additional energy from
the facility."
Conectiv (NYSE:CIV) was formed in March 1998 through a merger
involving Atlantic Energy and Delmarva Power & Light Company. The
company, headquartered in Wilmington, DE, provides regulated
electric and gas utility services and is also engaged in
telecommunications and other non-regulated activities. Conectiv
serves more than one million customers in New Jersey, Delaware,
Maryland, Virginia, and Pennsylvania.
PSEG Power LLC (PSEG Power) is a wholesale electric generation and
trading company operating in the northeastern United States. PSEG
Power is an unregulated subsidiary of PSEG (NYSE:PEG), a
diversified energy company. At the completion of this transaction,
PSEG Power will own 10,816 megawatts of capacity in the northeast.
Other subsidiaries of PSEG include: PSE&G, a regulated gas and
electric delivery utility; PSEG Energy Technologies, an
unregulated marketer of energy and energy services; PSEG
Resources, which makes passive, energy related investments; and
PSEG Global, which owns, develops and operates power plants and
electric distribution systems throughout the world.
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PECO Energy (NYSE: PE) is an electric and gas utility serving 1.5
million electric customers in the five-county Philadelphia area
and 400,000 natural gas customers in four suburban counties. It
is one of the nation's largest nuclear utilities, producing more
than 33 billion kilowatt-hours of electricity in 1998 at its
Limerick and Peach Bottom generating stations. PECO Energy has
set new nuclear performance standards in safety, availability and
capacity factors, efficient refueling outages, and low operating
and maintenance costs.
PECO Energy also owns and operates coal, natural gas, oil,
landfill gas and hydro power plants. PECO Energy's Team operates
a 24-hour energy trading floor with transactions in 47 states and
Canada.
Navigant Consulting, Inc. and Credit Suisse First Boston advised
Conectiv on the sale.
Navigant Consulting, Inc./Reed Consulting Group (NYSE: NCI) is a
global management consulting firm that provides strategic,
financial, management, and expert services to energy-based,
network, and other regulated industries.
In 1997, Reed Consulting Group merged with the Metzler Group,
Inc., a publicly-traded holding company for firms providing
consulting services to energy-related businesses. In 1999, the
Metzler Group and its subsidiaries, including Reed Consulting
Group, became Navigant Consulting, Inc.
Credit Suisse First Boston, a leading global investment banking
firm that provides comprehensive financial advisory, capital
raising, and financial products for users and suppliers of capital
around the world, is also advising Conectiv in the sales process.
The firm is wholly-owned by the Zurich, Switzerland-based Credit
Suisse Group.
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