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): November 9, 1998
Commission Registrant, State of Incorporation, I.R.S. Employer
File Number Address and Telephone Number Identification No.
- ----------- ---------------------------- ------------------
1-6047 GPU, Inc. 13-5516989
(a Pennsylvania corporation)
300 Madison Avenue
Morristown, New Jersey 07962-1911
Telephone (973) 455-8200
1-3141 Jersey Central Power & Light Company 21-0485010
(a New Jersey corporation)
2800 Pottsville Pike
Reading, Pennsylvania 19640-0001
Telephone (610) 929-3601
1-446 Metropolitan Edison Company 23-0870160
(a Pennsylvania corporation)
2800 Pottsville Pike
Reading, Pennsylvania 19640-0001
Telephone (610) 929-3601
1-3522 Pennsylvania Electric Company 25-0718085
(a Pennsylvania corporation)
2800 Pottsville Pike
Reading, Pennsylvania 19640-0001
Telephone (610) 929-3601
<PAGE>
ITEM 5. OTHER EVENTS.
-------------
As previously reported, on November 9, 1998 GPU announced that it had
entered into definitive agreements providing for the sale of its remaining
fossil fuel and hydroelectric generating facilities which were offered in a
competitive auction process begun during the first quarter of 1998.
Sithe Energies has agreed to acquire the fossil and hydroelectric
generating facilities and related assets of Jersey Central Power & Light Company
(JCP&L) -- other than JCP&L's 50% interest in the 400 MW Yards Creek pumped
storage station which was not included in the auction -- Metropolitan Edison
Company ("Met-Ed") and Pennsylvania Electric Company ("Penelec") -- other than
Penelec's 20% interest in the Seneca pumped storage station -- for a total
purchase price of approximately $1.68 billion. Of this amount, approximately
$442 million, $677 million and $561 million, respectively, is payable to JCP&L,
Met-Ed and Penelec.
Separately, FirstEnergy Corp. has agreed to purchase Penelec's 20% interest
in the Seneca Station for $43 million. Cleveland Electric Illuminating Co., a
subsidiary of FirstEnergy, currently owns the remaining 80% of the station.
As previously reported, in August 1998 Penelec and New York State
Electric & Gas Corporation agreed to sell their 50% ownership interests in the
1884 MW Homer City Station to Edison Mission Energy for $1.8 billion, and in
October 1998 GPU announced that definitive agreements had been signed to sell
the Three Mile Island Unit No. 1 nuclear station to AmerGen Energy Company LLC,
a joint venture of PECO Energy Company and British Energy, for approximately
$100 million.
The generation station assets are subject to receipt of various state
and federal regulatory approvals and other conditions.
A copy of GPU's news release relating to the agreements entered into
with Sithe Energies and FirstEnergy is annexed as an exhibit.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
-------------------------------------------------------------------
(c) Exhibits
1. GPU News Release, dated November 9, 1998.
<PAGE>
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934,
THE REGISTRANTS HAVE DULY CAUSED THIS REPORT TO BE SIGNED ON THEIR BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
GPU, INC.
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY
By: /s/ T. G. Howson
--------------------------------
T. G. Howson, Vice President
and Treasurer
Date: November 12, 1998
EXHIBIT TO BE FILED BY EDGAR
(c) 1. GPU News Release, dated November 9, 1998.
Exhibit (c) 1
GPU News Release
November 9, 1998
GPU Advances Strategy, Names Generation Divestiture Winners
- -----------------------------------------------------------
Morristown, N.J. - GPU, Inc. (NYSE: GPU) announced today it has signed
agreements to sell the remainder of its fossil-fueled and hydroelectric
generating assets for $1.72 billion, further advancing its strategy of becoming
an owner and manager of infrastructure assets.
Sithe Energies, a privately held company, has agreed to purchase 23 power plants
with a generating capacity of 4,117 megawatts, 18 generation development
properties, three support service organizations, and the Johnstown, PA office
building for $1.68 billion.
In a separate agreement, FirstEnergy Corporation, a diversified energy services
holding company, will purchase GPU's 87 megawatt interest (20 percent) in the
Seneca pumped-storage hyrdoelectric generating station for $ 43 million.
FirstEnergy already owns 80 percent of the Seneca plant. The sale transactions,
which will require a number of state and federal regulatory and other approvals,
are expected to close by mid-year 1999.
"With agreements to sell the Homer City Generating Station (August 3), the Three
Mile Island - Unit 1 Nuclear facility (October 15), and now these transactions,
GPU has taken the definitive step in our strategy to exit the generation
business and focus on the expansion of our infrastructure business, " said Fred
D. Hafer, GPU chairman, president and chief executive officer. "The sales are
truly beneficial to all stakeholders. For GPU, the sale relieves significant
stranded costs allowing us to be more competitive. For the plants, our
employees, and the surrounding communities, the size in the generation business
and commitments to growth by the buyers represent new opportunities that could
also help reduce the cost of electricity in the region."
(A complete list of facilities, sites and organizations in the agreements is
attached. Website addresses for GPU, Vivendi and FirstEnergy are listed at the
end of this release.)
Sithe and FirstEnergy, as the new owners of their respective assets, will assume
the current International Brotherhood of Electrical Workers collective
bargaining agreements covering the stations' employees. The new owners will have
the option of offering positions to the support staffs of the stations, the
Genco headquarters in Johnstown, a chemistry laboratory in Reading, and a
maintenance support organization.
As part of the sale agreement with Sithe, GPU's operating subsidiary, GPU
Energy, has an option to buy capacity at fixed prices through mid-year 2002 to
serve its customers' needs. Capacity is the obligation that GPU Energy and other
utilities have to ensure they have sufficient resources to provide for
customers' demands.
The maximum amount of capacity purchased under the option agreement will depend
both on GPU Energy's yearly needs and other available sources of capacity. GPU's
customer energy requirements will be provided from a mix of resources that
include existing power-purchase, non-utility generation contracts already in
place and purchases from PJM.
Sithe Energies, a joint-ownership of the French services company Vivendi (60%),
the Japanese trading company Marubeni Corporation (29%), and management
ownership (11%), currently operates 29 power plants in the United States and
Canada. The New York based company also has an extensive global portfolio of
projects under operation, construction or active development worth $6 billion.
FirstEnergy, a diversified energy services holding company headquartered in
Akron, Ohio, is the 12th largest electric system in the nation. Its four
operating companies provide electric energy and other energy-related products
and services to 2.2 million customers in central and northern Ohio and western
Pennsylvania.
In late summer GPU announced a $1.8-billion sale of the 1,884-megawatt Homer
City Station in Indiana County, PA, to Edison Mission Energy of Irvine, CA. The
station is co-owned by GPU and NGE Generation, an affiliate of New York State
Electric & Gas Corporation.
The combined sale of GPU's non-nuclear generating assets is $2.62 billion
resulting in 2.5 times book value, which equals approximately $510 per kilowatt.
In addition, last month GPU and AmerGen Energy Co. signed definitive asset
purchase agreements for the sale of GPU's 786 MW Three Mile Island Unit 1.
AmerGen is owned jointly by PECO Energy Co. and British Energy. When completed,
the TMI-Unit 1 transaction would be the first sale of a nuclear power plant.
"Proceeds from our generation sales will be used primarily to fund future
stranded costs,or those investments GPU made to serve customers in a regulated
environment, pay down acquisition debt, and possibly repurchase stock," Hafer
said. "We believe our focused strategy is right for GPU, for our stockholders
and for our customers. GPU is positioned to become a premier player in this
rapidly changing industry. "
GPU, Inc., headquartered in Morristown, NJ, is a registered utility holding
company. GPU's transmission and distribution subsidiaries - currently doing
business under the trade name GPU Energy serves approximately two million
customers in a service area encompassing about half land areas of New Jersey and
Pennsylvania.
GPU's other subsidiaries include: GPU Advanced Resoures, Inc.; GPU Nuclear,
Inc.; GPU Service, Inc. and the GPU International Group which owns, operates,
develops and invests in power generation transmission and distribution
facilities globally. The operation of GPU's fossil fuel and hydroelectric
generating facilities is conducted by GPU Generation, Inc. headquartered in
Johnstown, PA.
<PAGE>
<TABLE>
GPU GENERATION FACILITIES
Pennsylvania Facilities
<CAPTION>
GPU GPU GPU
Stations City Subsidiary Size Ownership Ownership Fuel Type
- -------- ------------ ---------- ---- --------- --------- ---------
(MW) (%) (MW)
<S> <C> <C> <C> <C> <C> <C>
Conemaugh New Florence Met-Ed 1,712 16% 282 Coal, Diesel
Keystone Shelocta JCP&L 1,710 17% 285 Coal, Diesel
Portland & Portland, Met-Ed 570 100% 570 Coal
Bangor Ash Bangor
Site
Seward New Florence Penelec 197 100% 197 Coal
Shawville Shawville Penelec 603 100% 603 Coal, Diesel
Titus Birdsboro Met-Ed 274 100% 274 Coal
Warren Warren Penelec 139 100% 139 Coal, Nat.
<CAPTION>
Gas, #2 Oil
CT's
- ----
<S> <C> <C> <C> <C> <C> <C>
Blossburg CT Tioga Penelec 19 100% 19 Nat. Gas
Hamilton CT East Berlin Met-Ed 20 100% 20 #2 Oil
Hunterstown CT Gettyburg Met-Ed 60 100% 60 Nat. Gas,
#2 Oil
Mountain CT Mount Holly Met-Ed 40 100% 40 Nat. Gas,
Springs #2 Oil
Orrtanna CT Gettysburg Met-Ed 20 100% 20 #2 Oil
Shawnee CT E. Stroudsburg Met-Ed 20 100% 20 #2 Oil
Tolna CT Stewartstown Met-Ed 40 100% 40 #2 Oil
Wayne CT Meadville Penelec 56 100% 56 #2 Oil
<CAPTION>
Hydro
- -----
<S> <C> <C> <C> <C> <C> <C>
Piney Clarion Penelec 27 100% 27 Hydro
York Haven York Met-Ed 19 100% 19 Hydro
<CAPTION>
Development
Sites
- -----
<S> <C> <C> <C> <C> <C> <C>
Coho Lake City Penelec 0 100% 0 N/A
East Sayre Bradford Penelec 0 100% 0 N/A
Erie West Erie Penelec 0 100% 0 N/A
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GPU GPU GPU
Stations City Subsidiary Size Ownership Ownership Fuel Type
- -------- ------------ ---------- ---- --------- --------- ---------
(MW) (%) (MW)
Development
Sites (Cont'd.)
- ---------------
<S> <C> <C> <C> <C> <C> <C>
Jackson Jackson Met-Ed 0 100% 0 N/A
Township
Middletown Middletown Met-Ed 0 100% 0 N/A
Junction
North Bangor Bangor Met-Ed 0 100% 0 N/A
North Hershey Hummelstown Met-Ed 0 100% 0 N/A
Phillipsburg Phillipsburg Penelec 0 100% 0 N/A
Portland Portland Met-Ed 0 100% 0 N/A
Adjacent
Property
Rockwood Somerset Penelec 0 100% 0 N/A
Scottsville Meshoppen Penelec 0 100% 0 N/A
Shelocta Indiana Penelec 0 100% 0 N/A
Williamsburg Williamsburg Penelec 0 100% 0 N/A
</TABLE>
<PAGE>
<TABLE>
GPU GENERATION FACILITIES
New Jersey Facilities
<CAPTION>
GPU GPU GPU
Stations City Subsidiary Size Ownership Ownership Fuel Type
- -------- ------------ ---------- ---- --------- --------- ---------
(MW) (%) (MW)
<S> <C> <C> <C> <C> <C> <C>
Gilbert & Milford, NJ JCP&L 538 100% 538 Nat. Gas
Hellertown Hellertown, PA
Tank Farm
Sayreville Sayreville JCP&L 435 100% 453 Nat. Gas,
#2, #6 Oil
<CAPTION>
CT's
- ----
<S> <C> <C> <C> <C> <C> <C>
Forked River Forked River JCP&L 66 100% 66 Nat. Gas,
CT #2 Oil
Glen Gardner Gen Gardner JCP&L 160 100% 160 Nat. Gas,
CT #2 Oil
Werner CT South Amboy JCP&L 212 100% 212 #2 Oil
<CAPTION>
Reservoir
- ---------
<S> <C> <C> <C> <C> <C> <C>
Merrill Creek Washington JCP&L, 0 100% 0 N/A
Met-Ed
<CAPTION>
Development
Sites
- -----
<S> <C> <C> <C> <C> <C> <C>
Atlantic Colts Neck JCP&L 0 100% 0 N/A
E. Flemington Flemington JCP&L 0 100% 0 N/A
HC Theurk Mercer JCP&L 0 100% 0 N/A
Pequest River Belvedere JCP&L 0 100% 0 N/A
Pohatcong Hackettstown JCP&L 0 100% 0 N/A
</TABLE>
<TABLE>
Maryland Facilities
<CAPTION>
GPU GPU GPU
Stations City Subsidiary Size Ownership Ownership Fuel Type
- -------- ------------ ---------- ---- --------- --------- ---------
(MW) (%) (MW)
<S> <C> <C> <C> <C> <C> <C>
Deep Creek Oakland Penelec 19 100% 19 Hydro
</TABLE>
<PAGE>
<TABLE>
Support Facilities
<CAPTION>
GPU GPU GPU
Stations City Subsidiary Size Ownership Ownership Fuel Type
- -------- ------------ ---------- ---- --------- --------- ---------
(MW) (%) (MW)
<S> <C> <C> <C> <C> <C> <C>
Brookville Brookville, Penelec 0 100% 0 N/A
Mobile PA
Maintenance
Genco Johnstown, PA Penelec 0 100% 0 N/A
Headquarters
GPU Nuclear Reading, TMI, All 3 0 100% 0 N/A
Laboratory Oyster Creek Companies
</TABLE>
<TABLE>
Separate Agreements
<CAPTION>
GPU GPU GPU
Stations City Subsidiary Size Ownership Ownership Fuel Type
- -------- ------------ ---------- ---- --------- --------- ---------
(MW) (%) (MW)
<S> <C> <C> <C> <C> <C> <C>
Seneca Warren Penelec 435 20% 87 Pumped-
Storage
Hydro
Homer City Homer City Penelec 1,884 50% 942 Coal
</TABLE>
