SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
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) September 14, 1999
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Commission File Number 1-5324
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NORTHEAST UTILITIES
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(Exact name of registrant as specified in its charter)
MASSACHUSETTS 04-2147929
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
174 BRUSH HILL AVENUE, WEST SPRINGFIELD, MASSACHUSETTS 01090-0010
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(Address of principal executive offices) (Zip Code)
(413) 785-5871
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
Item 5. Other Events
1. Dividend Reinstatement.
On September 14, 1999, the Northeast Utilities (NU) Board of Trustees
approved the payment of the company's first common stock dividend since March
1997. NU will pay a dividend of 10 cents a share on December 30, 1999, to
shareholders of record as of the close of business December 1, 1999. NU has
approximately 131.5 million shares outstanding. NU is the parent of a number
of companies comprising the NU system.
Management decided to resume payment of a common dividend because of the
financial turnaround NU has experienced since Millstone Station resumed the
production of electricity in July 1998. The NU system's net cash flows from
operations have nearly doubled, rising to $714 million over the 12 months
ended June 30, 1999, from $377 million in 1997. Long-term debt levels have
fallen to $3.15 billion as of June 30, 1999, from $3.65 billion at the end of
1997.
The NU system's financial performance continued to improve this summer
as a result of a strong economy and lower costs related to the Millstone
recovery. Compared with the first eight months of 1998, the NU system's 1999
retail sales were up more than 5 percent through August, and 3 percent on a
weather-adjusted basis. Another factor influencing the Board's decision to
reinstate the dividend was that there is now considerably less uncertainty
with respect to industry restructuring in the Northeast. Management
estimates that the initial dividend level will be sustainable over the next
several years and provide the company with considerable room to grow.
For more information regarding this matter, see NU's quarterly reports
on Form 10-Q for the quarters ending March 31, 1999 and June 30, 1999 and
NU's 1998 Annual Report on Form 10-K.
2. Proposed Sale of the Millstone Units
On September 15, 1999, NU announced that the Millstone Station nuclear
power plant assets of its subsidiaries The Connecticut Light and Power
Company (CL&P) and Western Massachusetts Electric Company (WMECO) will be put
up for public auction as soon as practical. NU also announced that none of
its subsidiaries would be bidding in the auction.
CL&P is required under Connecticut restructuring legislation to divest
its nuclear assets by January 1, 2004. WMECO is not required under the
Massachusetts restructuring act to divest its nuclear assets but it had
informed the Massachusetts Department of Telecommunications and Energy that
it would do so by January 1, 2004. Management believes that an earlier
auction would allow NU to take advantage of the current interest in New
England nuclear plants and to resolve the uncertainty for its employees,
customers and shareholders over the timing of the ultimate sale.
The details of the proposed auction process currently are under
development. Management expects the auction process will begin with the
filing, in November 1999, of a divestiture plan with the Connecticut
Department of Public Utilities Control (DPUC). Under terms of the
deregulation legislation, the DPUC will engage an independent consultant to
conduct the auction process. The final transfer of their Millstone assets is
expected to occur sometime in 2001.
The auction will include CL&P's 81% share of Millstone Unit 2, and its
53 percent share of Millstone Unit 3, as well as WMECO's 19 percent and 12
percent interests respectively in these units. In addition, when a pending
settlement between NU/Public Service Company of New Hampshire (PSNH) and the
State of New Hampshire is approved, it is expected that PSNH's 2.95 percent
share of Millstone Unit 3 also will be included. CL&P and WMECO will also be
proposing that Millstone Unit 1, currently being decommissioned, be included
in the auction. CL&P's, WMECO's and PSNH's net book investment in the three
Millstone units as of December 31, 1998 are $1.750 billion, $365 million and
$83.3 million, respectively.
The 36 percent share of the Seabrook Nuclear Station in New Hampshire
owned by NU's subsidiary North Atlantic Energy Corporation also will be put
up for public auction; however, no date will be set for that auction, at
least until final approval is received for the settlement agreement between
NU/PSNH and the State of New Hampshire. Once that agreement is approved, NU
anticipates that CL&P's 4.06 percent share of Seabrook will also be sold in
the auction.
For more information regarding this matter, see NU's quarterly reports
on Form 10-Q for the quarters ending March 31, 1999 and June 30, 1999 and
NU's 1998 Annual Report on Form 10-K.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NORTHEAST UTILITIES
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Registrant
Date SEPTEMBER 23, 1999 By /s/ David R. McHale
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David R. McHale
Vice President and Treasurer
