Message-ID: <26689735.1075844023595.JavaMail.evans@thyme> Date: Tue, 1 Aug 2000 06:27:00 -0700 (PDT) From: lorna.brennan@enron.com To: bill.cordes@enron.com, julie.mccoy@enron.com, steve.klimesh@enron.com, sarabeth.smith@enron.com, gary.sova@enron.com, rob.wilson@enron.com, lon.stanton@enron.com, john.goodpasture@enron.com, michael.ratner@enron.com, rockey.storie@enron.com, kent.miller@enron.com, john.dushinske@enron.com, dave.neubauer@enron.com, bill.fowler@enron.com, michael.bodnar@enron.com, joni.bollinger@enron.com, david.badura@enron.com, janet.bowers@enron.com, craig.buehler@enron.com, bob.burleson@enron.com, allen.cohrs@enron.com, john.fiscus@enron.com, steve.gilbert@enron.com, morgan.gottsponer@enron.com, stephen.herber@enron.com, dana.jones@enron.com, stephanie.korbelik@enron.com, bill.mangels@enron.com, penny.mccarran@enron.com, vernon.mercaldo@enron.com, larry.pavlou@enron.com, eileen.peebles@enron.com, tony.perry@enron.com, loren.penkava@enron.com, ken.powers@enron.com, chris.sebesta@enron.com, frank.semin@enron.com, neal.shaw@enron.com, larry.swett@enron.com, kay.threet@enron.com, mike.ullom@enron.com, lisa.valley@enron.com, chuck.wilkinson@enron.com, jim.wiltfong@enron.com, jo.williams@enron.com, karen.lagerstrom@enron.com, ray.stelly@enron.com, bob.stevens@enron.com, sue.neville@enron.com, mike.barry@enron.com, martha.janousek@enron.com, kimberly.watson@enron.com, don.powell@enron.com, steve.weller@enron.com, michael.stage@enron.com, tim.johanson@enron.com, laura.lantefield@enron.com, frank.oldenhuis@enron.com, jeff.nielsen@enron.com, tracy.schwartzkopf@enron.com, robert.mason@enron.com, sean.bolks@enron.com, miriam.martinez@enron.com, lee.ferrell@enron.com, john.williams@enron.com, mary.miller@enron.com, michel.nelson@enron.com, mike.mcgowan@enron.com, julia.white@enron.com, drew.fossum@enron.com, steven.harris@enron.com, jeffery.fawcett@enron.com, lorraine.lindberg@enron.com, kevin.hyatt@enron.com, christine.stokes@enron.com, tk.lohman@enron.com, michelle.lokay@enron.com, lindy.donoho@enron.com Subject: FPL Acquires Entergy Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Lorna Brennan X-To: Bill Cordes, Julie McCoy, Steve Klimesh, Sarabeth Smith, Gary Sova, Rob Wilson, Lon Stanton, John Goodpasture, Michael Ratner, Rockey Storie, Kent Miller, John Dushinske, Dave Neubauer, Bill Fowler, Michael Bodnar, Joni Bollinger, David Badura, Janet Bowers, Craig Buehler, Bob Burleson, Allen Cohrs, John Fiscus, Steve Gilbert, Morgan Gottsponer, Stephen Herber, Dana Jones, Stephanie Korbelik, Bill Mangels, Penny McCarran, Vernon Mercaldo, Larry Pavlou, Eileen Peebles, Tony Perry, Loren Penkava, Ken Powers, Chris Sebesta, Frank Semin, Neal Shaw, Larry Swett, Kay Threet, Mike Ullom, Lisa Valley, Chuck Wilkinson, Jim Wiltfong, Jo Williams, Karen Lagerstrom, Ray Stelly, Bob Stevens, Sue M Neville, Mike Barry, Martha Janousek, Kimberly Watson, Don Powell, Steve Weller, Michael G Stage, Tim Johanson, Laura Lantefield, Frank Oldenhuis, Jeff Nielsen, Tracy Schwartzkopf, Robert Mason, Sean Bolks, Miriam Martinez, Lee Ferrell, John Williams, Mary Kay Miller, Michel Nelson, Mike McGowan, Julia White, Drew Fossum, Steven Harris, Jeffery Fawcett, Lorraine Lindberg, Kevin Hyatt, Christine Stokes, TK Lohman, Michelle Lokay, Lindy Donoho X-cc: X-bcc: X-Folder: \Michelle_Lokay_Dec2000_June2001_1\Notes Folders\All documents X-Origin: LOKAY-M X-FileName: mlokay.nsf FPL Acquires Entergy FPL Group will acquire Entergy for about $6.4 billion in stock in a deal that will create the largest US power company. The news sent FPLs shares lower because of disappointment that FPL was not the takeover target. The combined company will have 6.3 million customers and 48,000 MW of power generating capacity. FPL supplies electric service to about 3.8 million customers throughout Florida. Entergy delivers electricity to about 2.5 million customers in parts of Texas, Arkansas, Louisiana and Mississippi. The deal, a $27 billion merger, which included their combined market value of $16.4 billion, $6.9 billion of Entergy debt and $3.8 billion of FPL debt. FPL shareholders will own 57% of the new company and Entergys 43%. The board of directors will be made up of 8 FPL members and 7 Entergy members. To support the deal, FPL and Entergy plan to buy back a total of $1 billion in stock, $570 million in FPL stock and $430 million in Entergy stock. FPL shareholders will receive one share in the new company for each of FPLs 170.5 million diluted shares outstanding. Entergy shareholders would receive 0.585 share in the new company for each of their 228.1 million diluted shares outstanding. Shares of FPL fell more than 8%, to 48-1/4 and Entergy shares fell more than 10% to 27-1/4 yesterday afternoon. Based on FPLs price on Monday morning, the deal values Entergy at about $28.33 per share. Many had speculated FPL was to be bought rather than be involved in a merger. The merger agreement includes a $200 million break-up fee in case either side terminates the deal. The merger of FPL and Entergy must be cleared by shareholders as well as federal regulators and was expected to close next year. The combined company expects to pay a dividend that is consistent with FPLs current dividend policy. Based on its current annual dividend of $2.16 per share, Entergys shareholders would receive $1.26 per share compared with its current dividend of $1.20 per share. FPLs Broadhead will become the chairman and Entergy Chief Executive Leonard will become chief executive of the new company. The expected annual cost savings and increased revenues for both competitive and regulated businesses may range from $150 million to $275 million, with about half the cost savings to come from work force reductions, mainly through attrition, growth and voluntary retirement.