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FORM 8-K
CURRENT REPORT
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 22, 1997
Commission Registrant; State of IRS Employer
File Number Incorporation; Address; Identification No
and Telephone Number
1-9513 CMS ENERGY CORPORATION 38-2726431
(A Michigan Corporation)
Fairlane Plaza South, Suite 1100
330 Town Center Drive
Dearborn, Michigan 48126
(313) 436-9261
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ITEM 5. Other Events
On April 22, 1997, CMS Energy Corporation announced it led a consortium
which was the successful bidder in the Australian State of Victoria's
privatization of its Loy Yang A power facility, a 2,000-megawatt, brown
coal-fueled plant. Loy Yang A is Victoria's largest electric generating
plant and Australia's lowest-cost electric generating facility. The
purchase also includes associated coal mine operations supplying both the
Loy Yang A and Loy Yang B plants.
The consortium agreed to purchase the Loy Yang A plant and the coal mine
at a purchase price of (U.S.) $3.67 billion. The consortium said 77
percent of the acquisition will be project financed by a consortium of
banks, with the remaining 23 percent comprised of partner equity.
CMS Energy's independent power subsidiary, CMS Generation, will hold a 50
percent ownership interest. CMS Energy has guaranteed CMS Generation's
obligation to make an equity contribution of approximately (U.S.) $500
million to acquire such ownership interest. CMS Energy expects to
initially fund CMS Generation's equity contribution from drawings on
existing or newly negotiated credit facilities. CMS Energy is negotiating
with a group of banks to replace its existing facilities (a $450 million
revolving credit and $125 million term loan) with a credit facility or
facilities consisting of a combination of unsecured revolving credit and
term loan tranches. CMS Energy expects the aggregate borrowing capacity
under the new facilities may range from $725 million to $1 billion.
The consortium expects to close the transaction and assume ownership and
operating responsibility in May 1997. Loy Yang A will be operated by a
jointly-owned operating company, with CMS holding a two-thirds ownership
interest.
Loy Yang A is one of the newest and most modern of Australia's brown coal-
fueled generating plants, with 73 percent of its electric output committed
under power supply contracts over the next 24 months. The coal mine
included in the privatization contains two billion tonnes of proven coal
reserves, enough to serve the coal supply needs of the Loy Yang A and Loy
Yang B plants for 50 years as well as the coal needs of a 1,000 megawatt
plant expansion. The mine has a supply contract with the 1,000-megawatt
Loy Yang B electric generating plant.
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SIGNATURES
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.
CMS ENERGY CORPORATION
Dated: April 24, 1997 By: /s/ Alan M. Wright
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Alan M. Wright
Senior Vice President,
Chief Financial Officer
and Treasurer
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