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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO
SECTION 14(D)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 17)
COLUMBIA ENERGY GROUP
(NAME OF SUBJECT COMPANY)
COLUMBIA ENERGY GROUP
(NAME OF PERSON(S) FILING STATEMENT)
COMMON STOCK, PAR VALUE $0.01
(TITLE OF CLASS OF SECURITIES)
197648108
(CUSIP NUMBER OF CLASS OF SECURITIES)
MICHAEL W. O'DONNELL
SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
COLUMBIA ENERGY GROUP
13880 DULLES CORNER LANE
HERNDON, VIRGINIA 20171
(703) 561-6000
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICE
AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)
COPY TO:
NEIL T. ANDERSON, ESQ.
SULLIVAN & CROMWELL
125 BROAD STREET
NEW YORK, NEW YORK 10004
(212) 558-4000
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This Amendment No. 17 amends and supplements the
Solicitation/Recommendation Statement on Schedule 14D-9 filed with the
Securities and Exchange Commission on July 6, 1999, and as subsequently amended
July 6, 1999, July 9, 1999, July 12, 1999, July 15, 1999, July 16, 1999, July
20, 1999, July 22, 1999, July 30, 1999, August 3, 1999, August 4, 1999, August
5, 1999, August 6, 1999, August 9, 1999, August 11, 1999, August 12, 1999 and
August 13, 1999 (as so amended, the "Schedule 14D-9"), by Columbia Energy Group,
a Delaware corporation (the "Company"), relating to the tender offer by NiSource
Inc., an Indiana corporation, to purchase for cash through its wholly-owned
subsidiary, CEG Acquisition Corp., a Delaware corporation, all of the
outstanding common shares, par value $0.01 per share, of the Company (the
"Offer"). Capitalized terms used but not defined herein have the meaning
ascribed to them in the Schedule 14D-9.
ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES.
Item 6 is hereby supplemented and amended by adding the following:
On August 13, 1999, pursuant to its previously announced repurchase
program, the Company purchased 9,000 Shares on the open market at a weighted
average price per share of $60.4444.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED.
Item 8 is hereby supplemented and amended by adding the following:
In connection with two lawsuits brought against the Company seeking to
enjoin the Company's stock repurchase program, on August 13, 1999 the Delaware
Chancery Court revised the scheduling of a hearing, pushing the hearing back to
early or mid-December 1999 from an originally contemplated date of September 22,
1999.
The Court noted that the Company "seems to be taking every measure
possible to assuage . . . fears that any of its board's actions might be tainted
by entrenchment motives."
Further, the Court noted the Company's intimation that "NiSource's
discovery requests are simply a way for NiSource to obtain currently nonpublic
information relating to [Columbia's] internal valuation information." The Court
encouraged the Company to "make the court aware of" any perceived problems and
to "suggest appropriate limitations."
The foregoing description of the Court's statement is qualified in its
entirety by reference to the full text of such statement, which is attached
hereto as exhibit (a)(17).
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
Item 9 is hereby supplemented and amended by adding the following:
Exhibit (a)(17) - Statement of the Delaware Chancery Court, dated
August 13, 1999.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
COLUMBIA ENERGY GROUP
By: /s/ Michael W. O'Donnell
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Name: Michael W. O'Donnell
Title: Senior Vice President and
Chief Financial Officer
Dated: August 16, 1999
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Exhibit List
Exhibit (a)(17) - Statement of the Delaware Chancery Court, dated August 13,
1999
[COURT OF CHANCERY OF THE STATE OF DELAWARE LETTERHEAD]
August 13, 1999
VIA FAX & U.S. MAIL
Robert Payson Gregory P. Williams
Potter Anderson & Corroon Raymond J. DiCamillo
P.O. Box 951 Richards, Layton & Finger
Wilmington, DE 19899 P.O. Box 551
Wilmington, DE 19899
Pamela S. Tikellis
Chimicles & Tikellis LLP
P.O. Box 1035
Wilmington, DE 19899
Re: NiSource Inc. v. Columbia Energy Group
Civil Action No. 17344
In re Columbia Energy Group Shareholder Litig.
Civil Action No. 17203
Dear Counsel:
I write in response to counsel's letters of August 10, 11, 12 and 13
regarding my previous decision to expedite the above captioned proceedings and
defendant Columbia Energy Group's ("CEG") latest proposal in response to
plaintiffs' Section 203 concerns. In light of CEG's proposal, and after
reconsidering the equities of the case, I have decided to revise the scheduling
of this matter. First, the Section 211 summary proceeding on the issue of CEG's
unfilled Board seat will proceed as scheduled on September 22 at 10:00 a.m. in
Wilmington. Second, I request that counsel confer and propose dates in early or
mid December for the scheduling of a preliminary injunction hearing on remaining
issues pending between the parties.
At the risk of seeming equivocal, I must consider the fact that CEG
seems to be taking every measure possible to assuage the plaintiffs' and the
Court's fears that any of its board's actions might be tainted by entrenchment
motives. I understand NiSource Inc.'s ("NiSource") concerns that CEG's proposal
might amount to a violation of Section 141(a) as an unlawful limitation on the
exercise of the board's fiduciary duties. Without reaching the merits of that
argument, as it will be more appropriately addressed
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at the preliminary injunction hearing, I do not think that it is fatal for the
purpose of considering the expedited scheduling of this matter. Thus, while the
Court will not enter an order implementing CEG's proposal, as a basis for
rescheduling these proceedings I accept CEG's stipulation that it will tender
such shares acquired in CEG's repurchase program into NiSource's offer that are
needed by NiSource to get to the 85% threshold of Section 203(a)(2) provided
that the number of shares acquired by the repurchase program equals or exceeds
the number of shares NiSource needs to reach that threshold.
I understand plaintiffs' position that the stock repurchase program is
only one of a number of devices that could act to entrench incumbent management
- - despite the fact that some of those devices preexisted NiSource's unsolicited
offer. Counsel should not take my reconsideration of the scheduling of this
matter as any indication of my opinion on the merits of that argument. With the
Section 203 problem apparently attenuated by CEG's stipulation, the remaining
issues that plaintiffs raise do not implicate any immediate actions by CEG's
Board. Thus, as a matter of judicial economy, it makes more sense for these
proceedings to move forward on a more typical schedule.
Finally, CEG has intimated that NiSource may be motivated to press on
with is claims for reasons having nothing to do with its proffered legal
position. In particular, CEG suggests that NiSource's discovery requests are
simply a way for NiSource to obtain currently nonpublic information relating to
CEG's internal valuation information. I do not take CEG's suggestion as a formal
application to limit discovery in this case. If, however, plaintiffs' requests
are indeed too broad or improper, I encourage CEG to make the Court aware of the
problem and to suggest appropriate limitations for the discovery request. At
this point, I am reluctant to impose any limitations before the parties have had
a chance to work the problem out without Court intervention. But the presence of
independently represented shareholder plaintiffs could afford the opportunity
for certain claims to be prosecuted by only those plaintiffs, thus avoiding the
problem of potentially compromising disclosures. I leave it to the parties to
resolve these issues.
Very truly yours,
/s/ William B. Chandler III
William B. Chandler III
cc: Register in Chancery
