SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) September 11, 2000
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NISOURCE INC.
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(Exact Name of Registrant as Specified in Its Charter)
Indiana 1-9779 35-1719974
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(State or Other (Commission File (IRS Employer
Jurisdiction of Number) Identification No.)
Incorporation)
801 E. 86th Avenue, Merrillville, Indiana 46410
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (219) 853-5200
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(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS.
As previously reported, on February 28, 2000, NiSource and
Columbia Energy Group entered into a merger agreement pursuant to
which NiSource agreed to acquire Columbia for approximately $6
billion, plus the assumption of approximately $2.5 billion of Columbia
debt. Under the merger agreement, NiSource has formed a new holding
company, currently named "New NiSource Inc." that will own Columbia
and NiSource's operating subsidiaries upon completion of the merger.
In connection with the merger, NiSource will be merged into the new
holding company, which will change its name to "NiSource Inc." The
merger and related transactions are described in the Joint Proxy
Statement/Prospectus dated April 24, 2000, which was mailed to
shareholders of both companies in connection with shareholder meetings
held to vote on the merger agreement.
The shareholders of both companies approved the merger agreement
at meetings held in early June 2000. NiSource and Columbia have
received all necessary approvals from state utility regulatory
commissions and the Federal Energy Regulatory Commission, and the
applicable waiting period under the federal antitrust laws has
expired. The companies anticipate receiving the balance of the
required regulatory approvals, including the approval of the
Securities and Exchange Commission under the Public Utility Holding
Company Act, in the near future.
NiSource has accepted a commitment letter under which Credit
Suisse First Boston Corporation and Barclays Bank PLC have agreed to
provide up to $6.0 billion to finance the acquisition of Columbia.
The commitment letter contemplates a revolving credit facility
expiring in July 2001, with the right to convert loans outstanding at
that time into term loans maturing 364 days thereafter. NiSource has
hedged the interest rate risk associated with $1.6 billion of its
anticipated refinancing of such debt. This commitment letter replaced
a similar commitment letter that would have expired in February 2001.
NiSource and Columbia have sold or are in the process of selling
several non-core businesses. Columbia has sold its liquefied natural
gas facility and retail energy marketing operations, and NiSource has
entered into a definitive agreement for the sale of its salt cavern
gas storage assets, which it expects will close later this month.
Columbia is in the process of selling its petroleum and propane
businesses and electric generation assets. These sales will strengthen
the new holding company's balance sheet and permit it to focus on its
core assets. In addition, NiSource understands that the SEC may require
the new holding company to sell NiSource's water utilities after the
merger as a condition to approving the acquisition.
In the merger, each NiSource common share will be exchanged for
one common share of the new holding company. Each Columbia share will
be exchanged for $70.00 in cash plus $2.60 principal amount of a unit
issued by the new holding company (consisting of a zero coupon debt
security coupled with a forward equity contract) or, at the election
of the Columbia shareholder, $74.00 of new holding company common
stock, based on the average closing price of NiSource common shares
for the 30 trading days immediately preceding the second trading day
prior to completion of the merger, but not more than 4.4848 shares.
Therefore, as long as the average price is $16.50 or greater, the
aggregate market value of the shares received, measured on the same
basis, will be $74.00 per Columbia common share. Stock elections will
be subject to proration if they are made with respect to more than 30%
of Columbia's outstanding shares and will not be given effect unless
they are made with respect to at least 10% of Columbia's outstanding
shares.
NiSource and Columbia currently expect to complete the merger in
late October 2000. Accordingly, on September 11, 2000, Chase Mellon
Shareholder Services L.L.C., the exchange agent for the merger, began
mailing stock election materials to Columbia shareholders. The right
of a Columbia shareholder to make an election will expire at 5:00
p.m., New York City time, on the second business day before the effec-
tive time of the merger. NiSource and Columbia have not yet
determined the effective time and the election deadline. Once they
have determined the effective time and the election deadline, they
will announce those dates in a press release, on their websites at
www.nisource.com and www.columbiaenergygroup.com and in a filing with
the SEC. Shareholders may also obtain up-to-date information
regarding the election deadline by calling the exchange agent at 1-
800-685-4258.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS
(c) Exhibits. The following exhibit is filed herewith:
99.1 Press release dated September 12, 2000.
SIGNATURE
Pursuant to the requirement 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.
NISOURCE INC.
(Registrant)
Dated: September 13, 2000 By: /s/ Stephen P. Adik
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Name: Stephen P. Adik
Title: Senior Executive Vice
President and Chief
Financial Officer
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION
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99.1 Press release dated September 12, 2000
