Securities and Exchange Commission
Washington, DC 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act 1934
Date of Report October 20, 1999
(Date of earliest event reported)
MidAmerican Energy Holdings Company
(Exact name of registrant as specified in its charter)
Iowa 0-25551 94-2213782
(State of other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
666 Grand Avenue Des Moines, Iowa 50309
(Address of principal executive offices) Zip Code
Registrant's Telephone Number, including area code: (515) 242-4300
N/A
(Former name or former address, if changed since last report)
Item 5. Other Events
On October 20, 1999, the Registrant announced that an
international arbitration panel entered final awards in favor of
Himpurna California Energy Ltd. ("HCE") and Patuha Power Ltd.
("PPL") in the arbitration matters brought by them against the
Republic of Indonesia ("ROI") for breach of sovereign performance
undertakings issued by the Ministry of Finance ("MOF"). HCE and
PPL are indirect subsidiaries of the Registrant. A press release
issued by the Registrant is attached hereto as Exhibit 1 and is
incorporated herein by reference.
Item 7. Financial Statements and Exhibits
Exhibit 1 - Press Release dated October 20, 1999
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.
MidAmerican Energy Holdings Company
By: \s\ Douglas L. Anderson
Douglas L. Anderson
Vice President
Dated: October 20, 1999
EXHIBIT 1
FOR IMMEDIATE RELEASE
Kevin Waetke, Director -- Corporate Communications (515) 281-2785
Jodie Stephens, Director -- Investor Relations (515) 281-2204
International Arbitration Panel Announces Favorable Final Decisions
For Himpurna California Energy and Patuha Power Requiring Republic of
Indonesia to pay $575,000,000
Des Moines, Iowa - October 20, 1999 - MidAmerican Energy Holdings
Company ("MidAmerican" or the "Company") (NYSE: MEC, PCX and London)
announced today that an international arbitration panel entered final
awards in favor of Himpurna California Energy Ltd. ("HCE") and Patuha
Power Ltd. ("PPL") in the arbitration matters brought by them against
the Republic of Indonesia ("ROI") for breach of sovereign performance
undertakings issued by the Ministry of Finance ("MOF"). The final
award directs the ROI to pay HCE $393,446,652 and PPL $182,305,322.
HCE and PPL are indirect subsidiaries of MidAmerican. MidAmerican
carries political risk insurance on its investment in HCE and PPL in
the aggregate amount of approximately $290,000,000.
The final awards follow a prior arbitration earlier this year brought
by HCE and PPL for breach of contract against PT.PLN (Persero), the
Indonesian Government's wholly-owned electric utility ("PLN"), in
which a separate arbitration panel found that PLN had materially
breached the provisions of the Energy Sales Contracts between PLN and
both HCE and PPL. Following PLN's failure to pay such amounts, PPL
and HCE demanded payment pursuant to the sovereign performance
undertakings issued by the MOF on behalf of the ROI and following the
ROI's failure to pay brought the most recent arbitration.
The current arbitration was an international proceeding conducted
under the United Nations Commission on International Trade Law
(UNCITRAL) rules. Chaired by an eminent international attorney, the
panel included an Australian engineer and international arbitrator
and an Indonesian law professor who is a distinguished international
legal scholar and head of the Indonesian National Arbitration
Institute.
The final awards from the arbitral tribunal ordered that:
* The ROI has to pay HCE and PPL $575,000,000 which includes
attorneys' fees and costs.
* The ROI is in breach of its performance undertakings and had
violated international law.
MidAmerican carries political risk insurance on its investment in HCE
and PPL through OPIC, an agency of the U.S. Government, as well as
through private market insurers. Such insurance covers expropriation
of the Company's investment in HCE and PPL, as well as material
breaches by PLN of the Energy Sales Contracts and by the ROI of its
performance undertakings. MidAmerican filed claims in the amount of
approximately $290,000,000 pursuant to such political risk insurance
policies with OPIC and the private market insurers and anticipates
such claims could be resolved by year-end.
- -More-
"We are pleased with this final award by the international
arbitration panel," said David L. Sokol, Chairman and Chief Executive
Officer of MidAmerican. "We look forward to resolving this matter
promptly with OPIC and the private insurers and receiving payment
under the political risk insurance policies."
MidAmerican Energy Holdings Company, headquartered in Des Moines,
Iowa, USA, has approximately 9,800 employees and is the largest
publicly traded company in Iowa. Through its retail utility
subsidiaries, MidAmerican Energy in the U.S. and Northern Electric in
the U.K., the Company provides electric service to 2.2 million
customers and natural gas service to 1.2 million customers worldwide.
Through CalEnergy, the Company's independent power production and non-
regulated business subsidiaries, and MidAmerican Energy's utility
operations, MidAmerican manages and owns interests in approximately
8,300 net megawatts of diversified power generation facilities in
operation, construction and development. Information about
MidAmerican and its three principal subsidiary companies is available
on the Internet at http://www.midamerican.com.
Certain information included in this release contains forward-looking
statements made pursuant to the Private Securities Litigation Reform
Act of 1995 ("Reform Act"). Such statements are based on current
expectations and involve a number of known and unknown risks and
uncertainties that could cause the actual results and performance of
the Company to differ materially from any expected future results or
performance, expressed or implied, by the forward-looking statements.
In connection with the safe harbor provisions of the Reform Act, the
Company has identified important factors that could cause actual
results to differ materially from such expectations, including
development uncertainty, operating uncertainty, acquisition
uncertainty, uncertainties relating to doing business outside of the
Unites States, uncertainties relating to geothermal resources,
uncertainties relating to domestic and international (and in
particular Indonesian) economic and political conditions and
uncertainties regarding the impact of regulations, changes in
government policy, industry deregulation and competition. Reference
is made to all of the Company's SEC filings, including the Company's
Report on Form 8-K dated March 26, 1999, incorporated herein by
reference, for a description of such factors. The Company assumes no
responsibility to update forward-looking information contained
herein.
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