Filed by Consolidated Edison, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: Consolidated Edison, Inc. (DE)
Commission File No. 333-31390
The following are stories from the March 2000 edition of NUsLine, a Northeast
Utilities newspaper which was distributed to all employees on April 5, 2000.
1. Mike Morris Perspective column
2. News story on proxy
3. Transition team and Human Resources opportunities.
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STORY NO. 1
Together we will succeed
Perspective column by Mike Morris
This is an historic time for Northeast Utilities as we work on completing our
merger with Consolidated Edison. As employees and shareholders, you have the
power to ensure that our company continues on the path of market growth and
financial stability by carefully reviewing the joint proxy statement and voting
for our merger with Con Edison.
Your vote is important and every vote counts. I encourage all of you to vote
your proxy in favor of the merger because:
* We will have the size and scale necessary to be successful in a restructured
and increasingly competitive energy market.
A combined NU/Consolidated Edison will be one of the largest utilities in the
United States with over 5 million electric customers and 1.3 million gas
customers from Pennsylvania north to the Canadian border.
* Together, we will have the size and resources to invest in infrastructure,
develop advanced technologies and grow. Con Edison and NU have both invested in
the North East Optic Network (NEON) and seek to capitalize on the exploding
market for digital broadband communication by installing fiber optic cable up
and down the northeast corridor and across the country.
* We will be substantially stronger financially. If NU stood alone, we would be
too small to compete effectively, lacking the financial resources to make
substantial acquisitions. With Con Edison's financial strength, we will have the
resources to grow, increase our customer base and provide more opportunities for
our employees.
* We share the same vision - to build on our reliable, safe regulated electric
and gas business and to grow our unregulated energy marketing and generation
business in the Northeast.
* As an NU shareholder, you can expect to receive a greater return on your
investment through a higher stock price and an increased dividend. Con Edison is
willing to pay more for NU shares than the current market value. Con Edison has
increased its dividend each year over the past 26 years. Con Edison currently
pays an annual dividend of $2.18 per share while NU's recently restored annual
dividend is $0.40 per share.
As employee shareholders, you have a voice in the outcome of this merger. No
matter how large or small your holdings, your voice counts. We need 2/3rds of
our shareholders to vote "for" the merger in order for this merger to be
approved. Silence, or not voting, is counted as a "no" vote.
If this merger fails, there will likely be another merger attempt in the future.
NU is an attractive, solid, profit-generating company, and we need to ask
ourselves: Would we be teamed with a company that shares our vision and our
commitment to our customers and our employees? Would the opportunities for
growth and stability exist with another suitor?
With Con Edison, we are joining a company with the same commitment to customer
service and operational excellence and their vision for future growth parallels
ours. We are two companies equally committed to safety and future growth and
that makes our merger a positive step forward for our employees, shareholders
and customers.
Some of you may receive three proxy cards - one from the 401K program, one from
the Employee Share Purchase Program, one from your own private broker or NU.
Each of these proxy cards counts as a separate vote and you will need to vote
all of the proxy cards you receive in order for your shares to be represented.
Your vote counts. This is a chance for you to make a difference and direct the
future of your company, your career and your financial investment. I hope you
will join me in voting "for" the merger.
GRAPHICS
"No matter how large or small your holdings, your voice counts."
<PAGE>
STORY NO. 2
Campaign to OK merger is on
Proxy cards must be voted by date indicated on each card
The Con Edison/Northeast Utilities joint proxy statement, including proxy voting
card, has been mailed to all Con Edison and NU shareholders, including
employees.
Regulations from the Northeast Utilities' Declaration of Trust requires that at
least two-thirds of NU shareholders approve the merger. NU officials are looking
for shareholders to mail in their ballots before the special shareholder meeting
April 14 at the Hartford Civic Center.
"I urge every shareholder to take the time to vote and I recommend a `yes'
vote," NU's Mike Morris said. "With this merger, we'll have the financial
resources to grow our businesses in a restructured energy marketplace. Our
customer base will increase and that provides additional opportunities for
employees."
Shareholders will be voting for two items. The first item gives NU permission to
amend its declaration of trust to allow a merger with another company. The
second item is voting on the actual merger.
NU officials are asking shareholders to mail in each proxy vote they receive.
Any proxy not returned is considered a "no" vote.
"This deal is a positive proposal for our shareholders," said Jeff Kotkin, NU's
director of Investor Relations and a member of the Con Edison/NU transition
team. "Con Edison is extremely stable financially and has an overriding focus on
its regulated electricity and gas delivery business.
"Both companies have a similar unregulated strategy in terms of staying
regional, focusing on energy and energy-related products and services, investing
in the telecommunications business (through the North East Optic Network
[NEON]), and owning generation to support marketing."
Financially, NU shareholders will benefit from the merger in several ways,
Kotkin said.
* Con Edison is willing to pay more for NU stock than its actual market value.
* Con Edison remains one of the most consistent utilities in terms of earnings
and dividend growth. Con Edison, which has increased its annual dividend each
year for the past 26 years, paid $2.12 per share for a yearly dividend in 1998,
$2.14 in 1999 and raised it to $2.18 for 2000. NU, which restored its dividend
this year, currently pays a yearly dividend of $0.40 per share.
* Employees and customers will benefit from Con Edison's strong financial
footing when the company seeks to raise capital to invest in electric
distribution companies and transmission system improvements. The financial
backing will positively influence infrastructure improvements and gain needed
capital for equipment and acquisitions of generation or transmission and
delivery facilities.
* Together, NU and Con Edison will remain focused on the northeast region and on
continuing to provide energy and energy services and products to their 6.4
million customers.
"Without this deal, NU's stock likely would have slumped along with the rest of
the utility industry, which is down 17 percent since the deal was announced last
October," Kotkin said.
NU's subsidiary, Mode 1, owns 26 percent of NEON, which is building a
fiber-optic network from Maine to Washington, D.C. and plans to expand
nationally in the next five years.
Industry analysts think highly of the merger proposal.
"Absent the merger with Con Edison, we estimate NU's stock would trade at about
$15 per share," said Brian Nelson, an equity analyst at Salomon Smith Barney on
March 1. "As a stand-alone stock, NU's positive attributes are strong
management, largely completed restructuring in all three states, stable utility
growth and additional growth from Select Energy and the Yankee Energy System
integration. [NEON] investment also is a positive for overall valuation."
NU's Shareholder Services has established an 800 line to answer shareholder's
questions. Call 1-800-794-1104 for additional information.
<PAGE>
STORY NO. 3
In search of fairness for all employees
Transition team gains ground on HR opportunities
"We have the potential to be a large organization supporting multiple operating
companies," said John de la Bastide, Con Edison Section Manager, Health Plans
and co-lead of the Human Resources Transition Team. "We'll need a free flow of
information exchange between the two companies, and the right policies will
enable that to occur."
These opening comments at the March 6 Business Sense seminar put into
perspective the work that's required to administer a benefits program for the
new merged Con Edison/NU company.
"The goal is to continue to support the corporate business strategy and
the expanding unregulated businesses," said de la Bastide. "We'll need to
keep the policies and procedures flexible to meet our going-forward business
needs."
As teammates on the merger transition team, de la Bastide and Jim Gavell, NU's
Human Resources director for the Retail Business Group, are thoroughly
evaluating the current HR policies and programs.
Working with sub-teams, the evaluation includes all HR policies, programs and
processes including medical, dental, life, vision, pension and 401K plans, to
develop the benefits strategy for the future.
Also under review are the holiday and vacation schedules and ensuring the smooth
transition of employees who move from one organization to the other on a
temporary or regular basis.
Trying to plan for and facilitate the HR needs of a merger can be an
overwhelming task. Gavell and de la Bastide have their team focused on the goal.
"Our top priority is to ensure all employees are treated fairly," said Gavell.
"We've involved the right people from NU and Con Edison. The work ahead of us
will ensure we find the right combination of options and develop implementation
plans that result in employees having competitive benefit, compensation and
retirement plans."
Having the responsibility to assess current practices and programs against
future opportunities is viewed as a privilege.
"We've budgeted the time we have between March and June to ensure we achieve our
goal of identifying opportunities in combining our companies, assessing each
opportunity for value, and determining the implementation steps by June," said
de la Bastide. "We understand that our work will answer some of the most
important questions on the minds of employees of both companies."
Gavell and de la Bastide are leading the efforts of 10 sub-teams of Con Edison
and NU employees working daily to evaluate and assess both companies' HR
programs. The focus areas include:
* advocating HR policies which are fair to employees, minimize anxiety and
unrest, and seek to avoid mass movement of employees;
* learning about each company's organizations, employees and HR policies and
programs including vacation plans, educational reimbursement, etc.; and
* comparing management philosophies and differences in the way the
companies currently work.
"The goal is to provide recommendations to the full transition team that
combine our companies to the benefit of all employees," said Gavell. The
focus is on:
* discussing and recommending best HR practices and how we'll move
forward as a merged company;
* providing opportunities for career growth in the combined company
through redesigned programs and policies; and
* discovering cost synergies in reduced duplicative services, maximized joint
purchase power, and reduced administrative costs.
"A thorough review of existing HR policies gives us the baseline information we
need to assess what each company brings to the table," said de la Bastide.
Gavell added, "We're performing a side-by-side comparison of all HR programs and
policies and documenting what's done and the management philosophies driving the
programs."
<PAGE>
Some of the comparisons under way include:
* Reviewing 401k programs at Con Edison, Orange & Rockland and NU. The outcome
of this review will be a recommendation of whether or not to merge into one plan
with a common administrator.
* Reviewing the individual components of the current health and welfare plans.
The goal is to use joint purchasing power to reduce overall administrative costs
and to maintain highly competitive programs for all employees. Studies will
recommend whether each operating company should continue with individual
programs or begin a process of combining, where possible, into common plans.
* Reviewing each company's pension plan and recommending best practices going
forward.
* Reviewing job posting and other employment practices in order to offer
increased opportunities in our merged company.
* Comparing all of the other HR plans affected by bringing Con Edison and NU
together.
"The level of anxiety felt by employees continues," said Gavell, "and we
recognize that. We're surfacing the critical issues now to ensure a speedy
resolution."
GRAPHICS
"We understand that our work will answer some of the most important questions
shared by employees of both companies."
John de la Bastide,
Con Edison/NU Merger Transition Team, Human Resources
Transition team goals timeline
March 2000: Identify combination options
April 2000: Refine options; present to full transition team
May 2000: Identify implementation steps
June 2000: Refine implementation plans; support combining our companies
following merger close in summer 2000.
LEGEND
For more information
Con Edison and Northeast Utilities have filed a joint proxy statement/prospectus
and other documents concerning the merger with the United States Securities and
Exchange Commission ("SEC") and have mailed the joint proxy statement/prospectus
to their shareholders. THESE DOCUMENTS CONTAIN IMPORTANT INFORMATION AND WE URGE
YOU TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS THAT HAVE
BEEN OR WILL BE FILED WITH THE SEC. You can obtain the documents free of charge
at the SEC's Web site, www.sec.gov. In addition, the documents are available
free of charge by requesting them in writing or by telephone from the companies
at the following addresses: Consolidated Edison, Inc., c/o The Bank of New York
Investors Relations Department, P.O. Box 11258, Church Street Station, New York,
New York 10286-1258, telephone 800-522-5522 and Northeast Utilities, P.O. Box
5006, Harford, Connecticut 06102-5006, Attention: Shareholders Services,
telephone 860-665-4801 or 800-999-7269.
This information contains forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934. The forward-looking
statements are subject to various risks and uncertainties. Discussion of factors
that could cause actual results to differ materially from management's
projections, forecasts, estimates and expectations may include factors that are
beyond the company's ability to control or estimate precisely, such as estimates
of future market conditions, the ability to realize cost savings and the terms
associated with obtaining regulatory approvals. Other factors include, but are
not limited to, weather conditions, economic conditions in the company's service
territory, fluctuations in energy-related commodity prices, marketing efforts
and other uncertainties. Other risk factors are detailed from time to time in
the two companies' SEC reports.
