<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM U-57
NOTIFICATION OF FOREIGN UTILITY
COMPANY STATUS
Filed under Section 33(a) of the Public Utility
Holding Company Act of 1935, as amended
Compania Nacional de Gas, S.A. de C.V.
(Name of foreign utility company)
Southern Union Company
(Name of filing company, if filed on behalf of a
foreign utility company)
The Commission is requested to mail copies of all
communications relating to this notification to:
Dennis K. Morgan
Vice President - Legal and Secretary
Southern Union Company,
President
Southern Union Energy International, Inc.
and
President
Southern Union International Investments, Inc.
504 Lavaca Street, Eighth Floor
Austin, Texas 78701
Mark F. Vilardo
Fleischman and Walsh, L.L.P.
1400 Sixteenth Street, N.W., Suite 600
Washington, D.C. 20036
PAGE>
Southern Union Company ("Southern Union"), a Delaware corpora-
tion, acting on behalf of Compania Nacional de Gas, S.A. de C.V.
("CNG"), hereby notifies the Securities and Exchange Commission
(the "Commission") that CNG proposes to be, and hereby claims
status for CNG as, a foreign utility company within the meaning
of Section 33 of the Public Utility Holding Company Act of 1935,
as amended (the "Act").
Item 1. Name, Address, Facilities and Ownership
- ------
The name and business address of the entity claiming foreign
utility company status is:
Compania Nacional de Gas, S.A. de C.V.
Edificio Salart
Morelos 511 Sur
Piedras Negras, Coahuila
Mexico
Each of CNG and its related companies -- Servicios Corparitivos
Phenix, S.A. de C.V., Construcciones, Instalaciones y Asesorias,
S.A. de C.V., and Materiales y Aparatos, S.A. de C.V. ("Phenix",
"CIASA" and "MASA," respectively, and, together with CNG, the
"Mexican Companies") -- is a limited liability variable stock
corporation (sociedad anonima de capital variable) organized
under the laws of the United Mexican States.
Description of Facilities. CNG provides natural gas distribution
services at retail to approximately 15,500 customers, consisting
of 14,950 residential customers, 525 commercial customers and 25
industrial customers, in Piedras Negras, Coahuila, Mexico, under
a permit granted by Mexican authorities. Natural gas is received
by CNG via two city gates with a loop pipeline developed system
which utilizes five to 20 pound pressure. CNG's distribution sys-
tem was established in 1934.
Only CNG is a "gas utility company" for purposes of the Act. The
other Mexican Companies do not distribute natural gas, but pro-
vide support services for CNG's operations, including corporate
and accounting functions, gas meter repairs, construction and
installation of gas service lines and equipment, and supplying
certain such equipment.
The Mexican Companies presently are, and since their organization
have been, 100% owned by members of the Libson family (the
"Libson Family"). CNG has outstanding a single class of capital
shares, par value one peso per share, which shares are the only
class of voting securities outstanding. Set forth below is a
list of those persons who hold 5% or more of the capital stock of
CNG, including the percentage of shares outstanding held by such
persons as of June 30, 1997 and the approximate percentage of
shares outstanding anticipated to be held by such persons after
giving effect to the Transaction (defined below).
Approximate
Percentage Percentage
as of After
Name of Stockholder 6-30-97 Transaction
- ------------------- ---------- -----------
Juan Antonio Cobo Martinez 16.2% 9.4%
Magdalena Cobo de Galan 16.2 9.4
Boris Libson Maldonado 14.4 8.4
Morris Libson Valdes 11.9 6.9
Hector N. Montemayor S. 10.1 5.9
Mauricio Libson Maldonado 8.5 4.9
Item 2. Domestic Public Utility Company
- ------
Southern Union distributes natural gas as a public utility in the
States of Texas and Missouri through Southern Union Gas and
Missouri Gas Energy, respectively, each of which is a division of
Southern Union. Southern Union Energy International, Inc.
("SUEI") and Southern Union International Investments, Inc.
("SUII"), two wholly-owned Delaware subsidiaries of Southern
Union, and Energia Estrella del Sur, S.A. de C.V., the Mexican
subsidiary of SUEI and SUII ("EES"), are presently engaged in a
process by which Southern Union will, indirectly, through SUEI,
SUII and EES, acquire ownership interests in the Mexican Com-
panies, including CNG (the "Transaction"). SUEI and certain
members of the Libson Family entered into a Stock Pledge Agree-
ment, dated February 20, 1997 (the "Stock Pledge Agreement"),
which provides for the pledge by such persons of at least 51% of
the capital stock of each of the Mexican Companies in considera-
tion of, and personal joint and several guarantees for, SUEI
loaning approximately $2.7 million, in the aggregate, to the
Mexican Companies. Such loans are evidenced by Promissory Notes,
also dated February 20, 1997, for each of the Mexican Companies
(the "Promissory Notes").
Under the terms of the Stock Pledge Agreement, SUEI was granted a
six-month option to convert the Promissory Notes into capital
stock of the Mexican Companies, which amounts shall be approxi-
mately 42%, in the case of CNG, Phenix and CIASA, and 48%, in the
case of MASA. For Mexican tax reasons, SUEI and SUII formed EES
as the wholly-owned Mexican subsidiary of such companies to hold
the stock in the Mexican Companies.
It is Southern Union's present intention to convert the Promis-
sory Notes into the equity investments described above as soon as
practicable. As a result of the Transaction, Southern Union will
become a domestic associate public-utility company of CNG under
Section 2(a)(10) of the Act.
Exhibit A. State Certification Required Under Section 33(a)(2)
- ---------
of the Act
State certifications from the Public Service Commission of
Missouri, dated July 3, 1997, and the Railroad Commission of
Texas, dated June 18, 1997, are filed herewith as Exhibits A.1
and A.2, respectively, as required under Section 33(a)(2) of the
Act.
<PAGE>
SIGNATURE
---------
The undersigned company has duly caused this statement to be
signed on its behalf by the undersigned thereunto duly
authorized.
SOUTHERN UNION COMPANY
Date: July 22, 1997 By: DENNIS K. MORGAN
----------------
Dennis K. Morgan
Vice President - Legal and
Secretary
(President, Southern Union Energy
International, Inc. and
President, Southern Union
International Investments, Inc.)
<PAGE>
EXHIBIT A.1.
[LETTERHEAD OF THE MISSOURI PUBLIC SERVICE COMMISSION]
July 3, 1997
Securities and Exchange Commission
450 Fifth Street, NW.
Washington, D.C. 20549
RE: Southern Union Company
Gentlemen:
Southern Union Company ("Southern Union"), doing business in the
State of Missouri as a public utility through its operating divi-
sion Missouri Gas Energy, has advised this Commission that
Southern Union is presently engaged in a process which the Com-
mission may conclude will lead to the indirect acquisition by it
of an ownership interest in a natural gas distribution business
located in Mexico, directly across the border from certain opera-
tions of Southern Union Gas Company, the Texas operating division
of Southern Union. Southern Union's subsidiary, Southern Union
Energy International, Inc. ("SUEI") is entering into definitive
loan agreements in the amount of approximately $2,700,000 (U.S.)
with the following companies which provide natural gas distribu-
tion service and/or other related services in Piedras Negras,
Coahuila, Mexico: Compania Nacional de Gas, SA de CV; Servicios
Corparitivos Phenix, SA de CV; Construcciones Instalaciones y
Asesorias, SA de CV; and Materiales Aparatos, SA de CV (the
"Mexican Companies"). The loan agreements, which constitute
agreements with the shareholders of the Mexican Companies, will
be secured by appropriate collateral and convertible at the
option of SUEI into equity of the Mexican Companies.
Southern Union has filed or will file a petition with the
Securities and Exchange Commission under Section 3(b) of the
Public Utility Holding Company Act of 1935, as amended ("PUHCA"
or the "Act"), for a foreign utility company exemption in respect
of their Mexican Companies investment. In connection therewith,
Southern Union has asked this Commission to provide you with the
certification contemplated by the applicable provisions of the
PUHCA.
The Missouri Public Service Commission has jurisdiction
over the retail natural gas rates of SMGC in the State
of Missouri and hereby certifies that with the commit-
ments of Southern, and its affiliates and subsidiaries,
it has the authority and resources to protect the rate-
payers subject to its jurisdiction and that this Com-
mission intends to exercise its authority with respect
to Southern's proposed investment in Compania Nacional
de Gas, SA de CV; Servicios Corparitivos Phenix, SA de
CV; Construcciones Instalaciones y Asesorias, SA de CV;
and Materiales Aparatos, SA de CV (Mexican Companies).
The Commission notes that this certification may be
revised or withdrawn prospectively as to any future
acquisition. In making this certification this Com-
mission is relying on the belief that the Securities
and Exchange Commission will enforce all sections of
PUHCA which govern Southern's proposed investment in
Mexican Companies for which it has jurisdiction.
The Missouri Public Service Commission has jurisdiction over the
retail natural gas rates for Missouri Gas Energy in the State of
Missouri and hereby certifies that it has the authority and
resources to protect the ratepayers subject to its jurisdiction
and that the Commission intends to exercise its authority with
respect to Southern Union's proposed investment in the Mexican
Companies.
Sincerely,
CECIL I. WRIGHT
---------------
Cecil I. Wright
Executive Secretary
cc: James Swearengen
Office of the Public Counsel
Penny Baker
<PAGE>
EXHIBIT A.2.
[LETTERHEAD OF THE RAILROAD COMMISSION OF TEXAS
Gas Services Division]
June 18, 1997
Mr. Jonathan G. Katz
Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549
Dear Mr. Katz:
Southern Union Company, a Delaware corporation, has advised this
Commission that it is presently engaged in a process which would
result in Southern Union's indirect acquisition of ownership
interests in each of Compania Nacional de Gas, S.A. de C.V., and
its related companies - Servicios Corparitivos Phenix, S.A. de
C.V., Construcciones, Instalaciones y Asesorias, S.A. de C.V.,
and Materiales y Aparatos, S.A. de C.V. In connection with such
activities, Southern Union Company has requested the Railroad
Commission of Texas to provide you the certification contem-
plated in Section 33 (a)(2) of the Public Utility Holding Company
Act of 1935 (15 U.S.C. 79 et seq.), which section was added to
that Act by Section 715 of the Energy Policy Act of 1992.
As the State Commission having jurisdiction over the retail gas
rates of the Southern Union Company, the Commission hereby
certifies that it:
(i) has the authority and resources to protect the rate-
payers of Southern Union Company, and
(ii) intends to exercise such authority.
This certification is intended to be applicable with respect to
the acquisition of ownership interests in Compania Nacional de
Gas, S.A. de C.V., and its related companies - Servicios
Corparitivos Phenix, S.A. de C.V., Construcciones, Instalaciones
y Asesorias, S.A. de C.V., and Materiales y Aparatos, S.A. de
C.V., and such other foreign utility company ventures in which
Southern Union Company or its current or future affiliates may
seek to obtain an ownership interest, but is conditioned on and
subject to being revised or withdrawn by this Commission as to
any future acquisitions. Southern Union Company has represented
that it will timely inform this Commission of any efforts by
Southern Union or its affiliates to seek ownership interest in
other foreign utility companies.
Sincerely,
RONALD L. KITCHENS
- ------------------
Ronald L. Kitchens
Director, Gas Services Division
Railroad Commission of Texas
cc: Office of Public Utility Regulations
Securities and Exchange Commission
450 Fifth Street, NW
Washington, D.C. 20549
Mr. Stephen A. Bouchard
Attorney
Fleischman and Walsh, L.L.P.
1400 Sixteenth Street, N.W.
Washington, D.C. 20036
