Filed by: NiSource Inc.
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: Columbia Energy Group
Registration Statement File No: 333-33896
On July 6, 2000, NiSource and Columbia announced that regulatory
agencies in Kentucky, Maine and Indiana have completed the needed
actions on the planned merger of the companies. The actions bring the
total to seven of nine states that have completed necessary actions on
the merger. The text of the joint press release follows:
JOINT PRESS RELEASE
JULY 6, 2000
NEWS RELEASE
CONTACTS:
Media
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NiSource- Maria P. Hibbs (219) 647-6201
Columbia- R.A. Rankin, Jr. (703) 561-6044
Investor Relations
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NiSource- Dennis Senchak (219) 647-6085
Columbia- Thomas L. Hughes (703) 561-6001
KENTUCKY, MAINE AND INDIANA COMMISSIONS OKAY NISOURCE/COLUMBIA MERGER
Seven of Nine States Complete Deliberations;
Settlements Reached in Two
MERRILLVILLE, Ind., and HERNDON, Va. (July 6, 2000) - NiSource
Inc. and Columbia Energy Group today said regulatory agencies in
Kentucky, Maine and Indiana have completed the needed actions on the
planned merger of the companies. Their actions bring the total to
seven of nine states that have completed necessary actions on the
merger.
The Kentucky Public Service Commission (KPSC) issued a merger
approval on June 30, subject to the consent of the merging companies
and Columbia Gas of Kentucky (CKY) to certain commitments. Those
consents are being submitted to the KPSC July 6. KPSC stated that as
approved the merger will have no impact on the base rates for CKY
customers, nor will it create additional costs to them. Terms of the
approval include: maintaining the headquarters of CKY in Lexington,
continuing economic development efforts and community contributions at
their present levels, and tracking merger savings for consideration in
CKY's next rate case, which is to be filed within 18 months of the
completion of the merger. A subsidiary of Columbia Energy Group, CKY
serves 141,000 natural gas customers, primarily in central Kentucky.
The Maine Public Utilities Commission (MPUC) issued its merger
approval on June 30, subject to certain financial and operating
conditions, regarding Northern Utilities, Inc., a natural gas
distribution unit of NiSource subsidiary Bay State Gas Company.
Northern Utilities serves 24,000 customers in southern Maine
communities.
The Indiana Utility Regulatory Commission (IURC) on June 23
stated in a letter to the U.S. Securities and Exchange Commission
(SEC) that the companies' proposed merger will not alter the IURC's
jurisdiction to monitor the activities of Northern Indiana Public
Service Company (NIPSCO). The IURC said its opinion is based on the
understanding that NiSource will operate NIPSCO and Columbia as
separate subsidiaries. A combination electric and natural gas
distribution subsidiary of NiSource, NIPSCO serves more than one
million energy customers in the northern third of Indiana.
"We are very pleased with the Kentucky and the Maine Commissions'
approvals and the Indiana Commission's timely letter," said Gary L.
Neale, NiSource chairman, president and chief executive officer.
"Their actions mark important steps toward reaching completion of our
merger this year. We remain dedicated to bringing excellent energy
services to Columbia customers in Kentucky, to Northern Utilities
customers in Maine and to NIPSCO customers in Indiana, as well as to
continue to support customer choice programs in both electricity and
natural gas."
Oliver G. Richard III, Columbia Energy Group chairman, president
and chief executive officer, said, "We are working closely with
NiSource to achieve a smooth transition. The progress on the
regulatory approval front is just one element of the broad cooperation
between the two companies, as we move ahead to the merger's expected
completion, and to bring its benefits to customers."
The Kentucky, Maine and Indiana actions follow merger-related
actions by the Public Utilities Commission of Ohio on May 2 regarding
Columbia Gas of Ohio, by the Commonwealth of Massachusetts' Department
of Telecommunications & Energy on May 12 regarding NiSource subsidiary
Bay State Gas Company, by the Maryland Public Service Commission on
May 25 regarding Columbia Gas of Maryland, and by the New Hampshire
Public Utilities Commission on June 6 regarding NiSource subsidiary
Northern Utilities, Inc.
Settlements have been reached in the two remaining states,
Pennsylvania and Virginia, with all parties to the proceedings in
those states. Final regulatory actions are expected soon.
Completion of the merger also is subject to approvals by certain
federal regulatory agencies, including the Federal Energy Regulatory
Commission and the Securities and Exchange Commission. The $6 billion
transaction was announced Feb. 28 and approved by shareholders of both
companies at meetings on June 1 and 2. The transaction is expected to
be completed by the end of 2000
NiSource Inc. (NYSE: NI) is a holding company with headquarters
in Merrillville, Ind., whose primary business is the distribution of
electricity, natural gas and water in the Midwest and Northeastern
United States. The company also markets utility services and customer-
focused resource solutions along a corridor from Texas to Maine. More
information about the company is available on the Internet at
www.nisource.com
Columbia Energy Group (NYSE: CG), based in Herndon, Va., is one
of the nation's leading energy services companies. Its operating
companies engage in nearly all phases of the natural gas business,
including exploration and production, transmission, storage and
distribution, as well as retail energy marketing, propane and
petroleum product sales, and electric power generation. More
information about Columbia is available on the Internet at
www.columbiaenergygroup.com.
This release contains forward-looking statements within the
meaning of the federal securities laws. These forward-
looking statements are subject to various risks and
uncertainties. The factors that could cause actual results
to differ materially from the projections, forecasts,
estimates and expectations discussed herein include factors
that are beyond the companies' ability to control or
estimate precisely, such as estimates of future market
conditions, the behavior of other market participants and
the actions of the federal and state regulators.
Other factors include, but are not limited to, actions in
the financial markets, weather conditions, economic
conditions in the two companies' service territories,
fluctuations in energy-related commodity prices, conversion
activity, other marketing efforts and other uncertainties.
These and other risk factors are detailed from time to time
in the two companies' SEC reports. Readers are cautioned
not to place undue reliance on these forward-looking
statements, which speak only as of the date of this release.
The companies do not undertake any obligation to publicly
release any revisions to these forward-looking statements to
reflect events or circumstances after the date of the
document.
In addition to other documents filed with the Securities and
Exchange Commission by the two companies, NiSource and the
new holding company have filed a registration statement,
which contains a joint proxy statement/prospectus for
NiSource and Columbia Energy. The final joint proxy
statement/prospectus, dated April 24, 2000, is available and
has been distributed to the companies' shareholders.
Investors and security holders are urged to read the joint
proxy statement/prospectus and any other relevant documents
filed with the SEC because they contain important
information. Investors and security holders may receive the
joint proxy statement/prospectus and other documents free of
charge at the SEC's Web site, www.sec.gov, from NiSource
Investor Relations at 801 East 86th Avenue, Merrillville,
Indiana 46410 or at its Web site, www.nisource.com, or from
Columbia Investor Relations at 13880 Dulles Corner Lane,
Herndon, Virginia 20171 or at its Web site,
www.columbiaenergygroup.com.
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