SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 30, 2000
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Southern Energy, Inc.
(Exact name of registrant as specified in its charter)
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Delaware 001-16107 58-2056305
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(State or other jurisdiction (Commission File (IRS Employer Identification
of incorporation) Number) No.)
1155 Perimeter Center West Suite 100, Atlanta, Georgia 30338
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (678) 579-7000
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N/A
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(Former name or former address, if changed since last report.)
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Item 2. Acquisition or Disposition of Assets.
On August 23, 2000, WPD Limited ("WPDL"), a company jointly owned by
subsidiaries of Southern Energy, Inc. and PPL Corporation ("PPL"), made an offer
to acquire all of the outstanding shares of Hyder plc ("Hyder") for a total
purchase price for the ordinary shares of Hyder of approximately (pound)565
million (approximately $847 million), or 365 pence (approximately $5.47) per
Hyder share, plus the assumption of approximately (pound)2.1 billion
(approximately $3.2 billion) of gross debt as of March 31, 2000. Hyder owns and
operates the electricity network in South Wales and the water distribution and
wastewater treatment business for all of Wales. On September 15, 2000, WPDL
committed unconditionally to purchase any shares of Hyder tendered by Hyder
shareholders. As of September 30, 2000, WPDL had purchased from shareholders
approximately 71% of the Hyder shares. On October 30, 2000, WPDL finalized the
acquisition of Hyder by making payment for the additional shares needed to bring
WPDL's ownership over 90%. Under UK company law, the acquisition of more than
90% of the outstanding shares allowed WPDL to acquire the remaining shares and
on October 31, 2000, WPDL sent notification to the outstanding shareholders
exercising this right.
With the completion of this acquisition and with the approval of lenders,
Southern Energy, Inc. and a subsidiary of PPL, effective December 2000, will
modify the voting rights of WPD Holdings ULC ("WPD Holdings") to 50% each
so that each party will share operational and management control of WPD
Holdings, which indirectly owns 100% of Western Power Distribution
("WPD"). WPDL has replaced Hyder's board of directors with employees of
WPD, Southern Energy, Inc. and PPL.
In September 2000 WPD Holdings, an indirect 49% owned subsidiary of Southern
Energy, Inc., closed a (pound)210 million ($310 million) 364-day term loan
facility (the "Facility") to finance part of the purchase price paid by WPDL for
the Hyder shares. The Facility's initial margin is 90 basis points per annum
above LIBOR, and once WPDL obtains a rating for its senior unsecured debt from
Standard & Poor's and/or Moody's, the margin will be based on a ratings grid.
The Facility's proceeds were loaned to WPDL at closing. Further, the
shareholders of WPD Holdings made a subordinated loan to WPD Holdings of
(pound)150 million ($222 million) which was loaned to WPDL, and the shareholders
of WPDL made a (pound)140 million ($207 million) loan to WPDL, in each case to
fund the Hyder share purchase. Both shareholder loans were made in proportion to
the respective shareholders ownership interest. In addition, WPD has loaned WPDL
(pound)85 million ($126 million) to fund the Hyder share purchase.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This Form 8-K includes forward-looking statements in addition to
historical information. These statements involve known and unknown risks and
relate to future events, Southern Energy, Inc.'s future financial performance or
its projected business results. In some cases, you can identify forward-looking
statements by terminology such as "may," "will," "should," "expects," "plans,"
"anticipates," "believes," "estimates," "predicts," "potential" or "continue" or
the negative of these terms or other comparable terminology. Forward-looking
statements are only statements of intent, belief or expectations. Actual events
or results may differ materially from any forward-looking statement as a result
of various factors. These factors include: legislative and regulatory
initiatives regarding deregulation and restructuring of the electric utility
industry; the extent and timing of the entry of additional competition in the
markets of Southern Energy, Inc.'s subsidiaries and affiliates; Southern Energy,
Inc.'s pursuit of potential business strategies, including acquisitions or
dispositions of assets or internal restructuring; state, federal and other rate
regulations in the United States and in foreign countries in which its
subsidiaries and affiliates operate; changes in or application of environmental
and other laws and regulations to which Southern Energy, Inc.
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION (Continued)
and its subsidiaries and affiliates are subject; political, legal and economic
conditions and developments in the United States and in foreign countries in
which the Southern Energy, Inc.'s subsidiaries and affiliates operate; financial
market conditions and the results of its financing efforts; changes in commodity
prices and interest rates; weather and other natural phenomena; Southern Energy,
Inc.'s performance of projects undertaken and the success of its efforts to
invest in and develop new opportunities; and other factors. Although Southern
Energy, Inc. believes that the expectations reflected in the forward-looking
statements are reasonable, it cannot guarantee future results, events, levels of
activity, performance or achievements.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of the businesses acquired.
The financial statements of Hyder plc will be provided in an
amended 8-K filing on or before December 30, 2000.
(b) Pro forma financial information.
The pro forma financial information will be provided in an
amended 8-K filing on or before December 30, 2000.
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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 thereunto duly authorized.
Date: November 14, 2000 SOUTHERN ENERGY, INC.
By /s/ James A. Ward
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James A. Ward
Senior Vice President, Finance
And Accounting
(Principal Accounting Officer)
