SEC FILE NO. 70-7727
and
SEC FILE NO. 70-8593
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CERTIFICATE PURSUANT TO
RULE 24
OF PARTIAL COMPLETION OF
TRANSACTIONS
GPU, Inc.
GPU International, Inc.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
- - - - - - - - - - - - - - - - - - -
:
In the matter of :
GPU, INC. : Certificate Pursuant
GPU INTERNATIONAL, INC. : to Rule 24 of Partial
: Completion of
SEC File No. 70-7727 : Transactions
SEC File No. 70-8593 :
(Public Utility Holding Company Act :
of 1935) :
:
- - - - - - - - - - - - - - - - - - -
TO THE MEMBERS OF THE SECURITIES AND EXCHANGE COMMISSION:
The undersigned, GPU, Inc. ("GPU") (formerly General Public
Utilities Corporation) and GPU International, Inc. ("GPU
International") (formerly Energy Initiatives, Inc.) hereby certify
pursuant to Rule 24 of the Rules and Regulations under the Public
Utility Holding Company Act of 1935 (the "Act"), that certain of
the transactions proposed in the Applications, as amended, filed
in SEC File No. 70-7727 and SEC File No. 70-8593, respectively,
have been carried out in accordance with the Commission's Orders
dated November 16, 1995, June 14, 1995, December 28, 1994,
September 12, 1994, December 18, 1992, and June 26, 1990 with
respect to the transactions proposed in the Application, as
amended, in SEC File No. 70-7727, and the Commission's Orders
dated July 6, 1995, January 19, 1996 and March 6, 1996 with
respect to the transactions proposed in the Application, as
amended, in SEC File No. 70-8593, as follows:
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The following is reported in accordance with Supplemental
Order dated November 16, 1995 for SEC File No. 70-7727:
1. Financial Statements
A copy of GPU International's unaudited Consolidated
Balance Sheet as of June 30, 1996 and unaudited Consolidated
Statements of Operations for the three and six month periods ended
June 30, 1996 will be filed separately under a request for
confidential treatment pursuant to Rule 104(b).
2. Business Activities
Project Development
In May 1996, GPU and Cinergy Corp. formed Avon Energy
Partners plc (Avon"), a wholly-owned subsidiary of Avon Energy
Partners Holdings, Inc. ("Holdings"). Holdings is a 50/50 joint
venture formed to acquire Midlands Electricity plc ("Midlands"),
an English regional electric company ("REC"). Avon has made a
successful cash tender offer of approximately $2.6 billion for the
outstanding shares of Midlands. GPU's 50 percent interest in
Holdings is held by EI UK Holdings, Inc. ("EI UK"), a wholly-owned
subsidiary of GPU Electric, Inc. ("GPU Electric") (formerly EI
Energy, Inc.).
In May 1996, GPU International completed a $150 million
financing for the construction of a 300 megawatt ("MW") gas-fired
cogeneration facility with energy and capacity to be sold to
Georgia Power Company. Construction of the facility which will be
located in Houston County, Georgia, will begin in September 1996
and commercial operation is scheduled for February 1998.
GPU International continued preliminary project
development of a proposed approximately 236 MW gas-fired
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cogeneration facility with energy and capacity to be sold to
Wisconsin Public Service Company.
GPU International also continued to engage in other
project development activities both domestically and
internationally (including in Europe, Asia, and South America).
Project Related Services
GPU International continued to provide management,
administrative and/or operating services to the following projects
(either directly or through subsidiaries), in which GPU
International has a direct or indirect ownership interest:
Project Project Owner Location
Marcal Prime Energy L.P. NJ
Berkeley OLS Acquisition Corp. CA
Chino OLS Acquisition Corp. CA
Camarillo OLS Acquisition Corp. CA
Onondaga Onondaga Cogeneration L.P. NY
Lake Lake Cogen L.P. FL
Pasco Pasco Cogen L.P. FL
Syracuse Project Orange Associates L.P. NY
Ada Ada Cogeneration L.P. MI
In addition, EI Services Canada Limited (a wholly-owned
subsidiary of EI Canada Holding Limited, which in turn is a
wholly-owned subsidiary of GPU International) has commenced
commercial operations in April 1996. EI Services Canada Limited,
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an exempt wholesale generator ("EWG"), was formed to provide
operations and maintenance services to EWGs in Canada, and will
initially provide such services to Brooklyn Energy Limited
Partnership, an EWG.
3. Guarantees which GPU has Agreed to Grant
No matters to be reported.
4. Guarantees Issued
GPU International or GPU, for the benefit of GPU
International, has obtained the following standby letters of
credit which were effective during the period April 1, 1996
through June 30, 1996:
(a) On February 26, 1996, a letter of credit in the
face amount of $30,000 was issued by Citibank
pursuant to its credit agreement with GPU
International (Citibank Credit Agreement) to
support a bid for a 500 MW coal-fired generating
plant in Punjab State, India. The letter of
credit carries a fee equal to 0.5 of 1 percent
per annum of the face amount, plus a .10 percent
fronting fee, and expires on May 26, 1997.
(b) On December 8, 1995, a letter of credit in the
face amount of $1,788,850 was issued by Citibank
pursuant to the Citibank Credit Agreement in
favor of Wisconsin Public Service Company to
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support Polsky Energy Corp's (PEC) commitment to
construct a 236 MW cogeneration facility pursuant
to its Power Sales Agreement with Wisconsin
Public Service Company. GPU International is the
joint developer and owner, along with PEC, of
this facility. The letter of credit carries a fee
equal to 0.5 of 1 percent per annum of the face
amount, plus a .10 percent fronting fee, and
expires on December 8, 1996.
(c) On May 17, 1996, a letter of credit in the face
amount of $7 million issued on August 7, 1995 by
Citibank pursuant to the Citibank Credit
Agreement in favor of Georgia Power Company, to
support GPU International's commitment to
construct a 300 MW cogeneration facility pursuant
to its Power Sales Agreement with Georgia Power
Company was cancelled upon completion of
financing. The letter of credit carried a fee
equal to 0.5 of 1 percent per annum of the face
amount, plus a .10 percent fronting fee.
(d) On July 1, 1995, a letter of credit in the face
amount of $1.5 million was issued by United
Jersey Bank in favor of Polsky Energy Corporation
to guarantee GPU International's 1996 equity
obligation pursuant to its stock purchase
agreement with Polsky Energy Corporation. GPU
entered into the related reimbursement agreement.
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The letter of credit which expired on July 1,
1996, carried a fee equal to 0.5 of 1 percent per
annum of the face amount.
(e) On June 16, 1994, a letter of credit in the face
amount of $5 million was issued by Chase
Manhattan Bank in favor of Mellon Bank to support
debt service coverage on the Onondaga Project.
The letter of credit carries a fee equal to 0.7
of 1 percent per annum of the face amount, and
expires on June 16, 1997. GPU entered into the
related reimbursement agreement.
(f) On March 11, 1994, a letter of credit in the face
amount of $9.7 million was issued by Canadian
Imperial Bank of Commerce, in favor of The Mutual
Life Assurance Company of Canada to support GPU
International's equity commitment to Brooklyn
Energy Limited Partnership, an EWG. The letter
of credit carries a fee equal to 0.625 of 1
percent per annum of the face amount, and expires
on December 11, 1996. GPU entered into the
related reimbursement agreement.
In addition, the following guarantees were outstanding
during the period April 1, 1996 through June 30, 1996:
(a) As of October 18, 1995, a guarantee of amounts up
to $122,750,000 was made by GPU for the benefit
of the Bankers Trust Company as collateral agent
on behalf of the Equity Bridge Lenders and the
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Secured Parties in connection with the
Barranquilla, Colombia acquisition, previously
reported in the December 1995 filing.
(b) GPU International has guaranteed the obligations
of GPU Power, Inc. ("GPU Power") (formerly EI
Power, Inc.) subsidiaries, EI Services Colombia,
Ltda. and International Power Advisors, Inc. (the
Operators), under the operations and maintenance
agreement in the Colombia project. Pursuant to
the guarantee, GPU International has guaranteed
the performance of the Operators, of which the
limit of liability is $5 million.
(c) GPU has guaranteed payments to General Electric
Capital Corporation of amounts up to the lesser
of six months' average rent (approximately
$7,026,000) or $10 million, to the extent Lake
Cogen, Ltd. fails to pay rent when due under the
terms of the project lease or chooses not to
renew the lease after its initial 11-year term.
In addition, GPU has guaranteed to pay any
documentary stamp taxes and intangible personal
property taxes should these taxes become due and
payable in connection with the lease.
5. Services obtained from associated companies
Services obtained from GPU Service, Inc. (formerly GPU
Service Corporation) consisted of (i) administrative, internal
auditing, accounting and risk management services; (ii)
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information services and telecommunications services, and (iii)
pension administration services. The total dollar value of such
services provided during the period April 1, 1996 through June 30,
1996 was $196,092.
6. Services provided to associated companies
A description of services provided by GPU International
to associate companies during the period April 1, 1996 through
June 30, 1996 will be filed separately under a request for
confidential treatment under Rule 104(b).
7. Investments by GPU in Qualifying Facilities, Exempt
Wholesale Generators and Foreign Utility Companies, Percentage of
Equity Ownership
Set forth below is a summary of the direct or indirect
investments by GPU, as of June 30, 1996 in QFs, EWGs and FUCOs, as
well as the percentage of equity ownership.
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Book Value
FUCO, of GPU GPU's% Owners not affiliated
QF Investment Equity with GPU
Associate or at 6/30/96 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
Prime Energy,
LP QF $5,576 50% Prudential
Insurance
Company of
America Domestic
OLS Power,
LP (1) QF - 1% Prudential
Insurance
Company of
America Domestic
Enron Power
Marketing,Inc. Domestic
Onondaga QF 18,367 50% New York
Cogen, LP Cogenco, Inc. Domestic
Lake Cogen,
LP QF 3,150 42% Lake Interest
Holding, Inc. Domestic
Project Orange QF (28) 4% G.A.S. Orange
Associates, LP Partners,LP Domestic
NCP Syracuse
Inc. "
Syracuse
Investment Inc. "
Stewart &
Stevenson "
Operations, Inc.
MetLife Capital
Corporation "
Ada Cogenera- QF 15 1% Cogen Develop-
tion, LP ment Co. Domestic
Coenergy
Ventures, Inc. "
Pasco Cogen, QF 15,962 50% PAS Power
Ltd. Company Domestic
Pasco Int.
Holding, Inc. "
FPB Cogenera- QF - 30% FPB Cogen,Inc.
Domestic
tion Partners, FPB California "
LP Cogeneration
Corp.
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Selkirk Cogen EWG & 15,094 19% JMC Selkirk,
Partners, LP QF Inc. Domestic
Cogen Tech-
nologies "
Selkirk GP, Inc.
Cogen Tech-
nologies Sel-
Kirk, LP "
JMCS I Inves-
tors, LP "
(1) In June 1996, Camchino Energy Corporation, a subsidiary of
GPU International, Inc., sold to Enron Power Marketing, Inc.
a 49% limited partnership interest in OLS Power, LP.
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Book Value
FUCO, of GPU GPU's% Owners not affiliated
QF Investment Equity with GPU
Associate or at 6/30/96 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
Empresa
Guarachachi
S.A. EWG 48,875 50% Cititrust
(Bahamas)
Limited
ForeignGuaracachi
America, Inc. EWG 33,654* 100% Not Applicable N/A
GPU Power,
Inc. EWG 31,267* 100% Not Applicable N/A
EI Interna-
tional EWG (358) 100% Not Applicable N/A
EI Services
Colombia,
Ltda EWG (371)* 100% Not Applicable N/A
Solaris
Power FUCO 113,099 50% Australian
Gas Light, Co. Foreign
Victoria
Electric Inc. FUCO 112,888* 100% Not Applicable N/A
EI Australia
Services, Pty,
Ltd. FUCO 623 100% Not Applicable N/A
EI UK Holdings,
Inc. FUCO 525 100% Not Applicable N/A
Avon Energy
Partners
Holdings,
Inc. FUCO 469,023 50% Cinergy Corp.
Domestic
Avon Energy
Partners plc FUCO 1,247,930* 50% Cinergy Corp.
Domestic
Midlands
Electricity
plc FUCO 1,257,930* 50% Cinergy Corp.
Domestic
Termobarran-
quilla S.A. EWG (1,977) 29% ABB Energy
Ventures,
Inc. Foreign
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EI Barran-
quilla, Inc. EWG (2,054)* 100% Not Applicable N/A
Barranquilla
Lease Holdings,
Inc. EWG 12 100% Not Applicable N/A
Los Amigos
Leasing Com-
pany, Ltd. EWG 12* 100% Not Applicable N/A
EI Services
Canada, Ltd. EWG 43 100% Not Applicable N/A
Book Value
FUCO, of GPU GPU's% Owners not affiliated
QF Investment Equity with GPU
Associate or at 6/30/96 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
EI Canada
Holding, Ltd. EWG 345* 100% Not Applicable N/A
EI Brooklyn
Investment,
Ltd. EWG 180* 100% Not Applicable N/A
EI Brooklyn
Power, Ltd. EWG 313* 100% Not Applicable N/A
Brooklyn
Energy, LP EWG 415 75% Polsky Energy
Corp. of
Brooklyn Foreign
Brooklyn
CoGen
Limited Foreign
________
GPU's Aggregate
Investment* $688,416
(*) GPU's aggregate investment does not include the
items shown with asterisks in order to avoid
duplication.
As of June 30, 1996, GPU also owned, directly or
indirectly, interests in the following EWGs, in which its
aggregate investment did not exceed $10,000: International Power
Advisors, Inc.; Austin Cogeneration Corporation; Austin
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Cogeneration Partners, L.P.; Hanover Energy Corporation; EI Power
(China), Inc.; China Power Partners, L.P.; EI Power (China)I,
Inc.; Ming Jiang Power Partners, L.P.; EI Power (China)II, Inc.;
Nanjing Power Partners, L.P.; EI Power (China) III, Inc.; and
Zhuang He Power Partners, L.P. GPU owns a 50% interest in China
Power Partners, L.P., Ming Jiang Power Partners, L.P., Nanjing
Power Partners, L.P., and Zhuang He Power Partners, L.P. The
remaining interests are owned by Intesol International, Ltd., a
Hawaii corporation. GPU owns a 100% interest in each of the other
EWGs.
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8. During the period April 1, 1996 through June 30, 1996 there
was no intellectual property provided to GPU International by any
associate company, or provided by GPU International to any
associate company.
_______________________________________
In accordance with Orders dated July 6, 1995 and March 6, 1996
in SEC File No. 70-8593, and in addition to the reimbursement
agreements and investments in Termobarranquilla, S.A. and Midlands
Electricity plc., described in items 4 and 2 above, respectively,
the following is reported:
1. Financial Statements
A copy of GPU Electric's unaudited Consolidated Balance
Sheet as of June 30, 1996 and unaudited Consolidated Statements of
Operations for the three and six month periods ended June 30, 1996
will be filed separately under a request for confidential
treatment pursuant to Rule 104(b).
2. Investments in Exempt Entities
In connection with the acquisition of Midlands discussed
above in Item 2. Business Activities, EI UK entered into a term
loan agreement (the "Term Loan") dated as of May 6, 1996, with a
syndicate of banks, The Chase Manhattan Bank, N.A., as
administrative agent, Citibank, N.A., as syndication agent,
Citicorp Securities, Inc. and Chase Securities Inc., as arrangers.
The Term Loan provides, among other things, for EI UK borrowings
from time to time of up to pounds sterling 350 million, or
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approximately U.S. $500 million, through a GPU guaranteed five-
year bank term loan facility terminating on May 6, 2001.
The borrowing interest rate is based on the PIBO rate plus an
applicable margin as defined in the Term Loan corresponding to the
debt ratings of GPU. As of June 30, 1996, EI UK had aggregate
borrowings of pounds sterling 306 million, or approximately U.S.
$474.9 million, outstanding under the Term Loan. EI UK invested
such funds in Midlands through Holdings. The borrowings bear
interest at 6.2875 percent per annum, which was based on the PIBO
rate at June 26, 1996, plus a .475 percent margin.
On November 22, 1995, GPU acquired all of the capital stock of
GPU Electric and made capital contributions of $48 million. The
capital contributions were used by GPU Electric to acquire Solaris
(through Victoria Electric, Inc.).
On November 20, 1995, GPU Electric entered into a credit
agreement, dated as of November 20, 1995, (the "Credit
Agreement"), with Citibank Limited as the Participant and
Arranger, for which Citisecurities Limited is the Agent. The
Credit Agreement provides, among other things, for revolving
credit borrowings by GPU Electric from time to time through
November 20, 1998, subject to extensions for two years at the sole
discretion of the Participant, in amounts not to exceed an
aggregate of Australian $95 million outstanding at any one time.
Borrowings are guaranteed by GPU.
Notes issued under the Credit Agreement bear interest at
the Bill Discount Rate which is:
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(a) the rate percent per annum determined
by the Agent which is equal to the mean
"bid rate" quoted on the page entitled
"BBSY" on the Reuters Monitor System at
or about 10:00 a.m. (Sydney time) on
the Funding Date (provided that at
least 4 banks are quoting) for bank
accepted Bills having a tenor equal to
the Funding Period of the Funding
Portion commencing on that Funding
Date; or
(b) if in respect of any Funding Date the
Base Discount Rate cannot be determined
in accordance with paragraph (a) of
this definition, the rate percent per
annum determined by the Agent in good
faith to be the rate most nearly
approximating the rate that would
otherwise have been calculated by the
Agent in accordance with paragraph (a)
of this definition.
On May 21, 1996, GPU Electric made a principal payment of
Australian $1.4 million, or approximately U.S. $1.1 million,
under the Credit Agreement. At June 30, 1996, the remaining
outstanding balance of the borrowing amounted to Australian $90.1
million, or approximately U.S. $71 million.
Other investments in exempt entities are described in items
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2 and 4 above under 70-7727.
3. Description of Exempt Entities in Which There are Funds
Invested
Selkirk Cogen Partners, L.P. (Selkirk)
Selkirk owns and operates two natural gas-fired combined-
cycle cogeneration facilities located in Bethlehem, New York. The
facilities are 79.9 and 265 megawatts (MW) each with a combined
average net capacity of 344.9 MW producing steam and electricity.
Brooklyn Energy, L.P. (Brooklyn)
On March 11, 1994, GPU International entered into an
agreement with Polsky Energy Corporation to invest up to $9.7
million of equity in Brooklyn. The equity will be used towards
the construction and operation of a 24 MW wood and oil-fired
cogeneration facility, which is located in Brooklyn, Nova Scotia,
Canada. Commercial operation of the facility commenced on April
1, 1996.
Empresa Guaracachi, S.A.
In July 1995, GPU Power, through Guaracachi America, Inc.,
acquired from the Bolivian Government a 50% interest in Empresa
Guaracachi, S.A., an electric generating company having an
aggregate capacity of 216 MW of natural gas-fired and oil-fired
generation for approximately $47 million. The facilities are
located in Bolivia in and around the cities of Santa Cruz, Sucre
and Potosi with its total capacity representing one-third of
Bolivia's generation capacity. GPU Power's investment of $47
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million will be used over the next seven years to expand the
generating facilities to meet Bolivia's growing demand.
Solaris Power (Solaris)
In November 1995, GPU Electric, through Victoria Electric,
Inc., together with the Australian Gas Light Company, acquired
Solaris for a total purchase price of approximately $712 million,
of which GPU Electric's 50% share is $356 million. GPU Electric
has made an equity investment in Solaris of approximately $112
million; the balance of the purchase price was provided through
non-recourse borrowings by Solaris from an Australian bank
syndicate. Solaris, which provides electric service to more than
230,000 customers in and around Melbourne, Australia, was sold by
the government of Victoria through a competitive bid as part of
that state's privatization of the electric industry.
Termobarranquilla, S.A.
In October 1995, GPU Power, through EI Baranquilla, Inc.,
completed the financing for and acquired a 29% interest in
Termobarranquilla, S.A., Empresa de Servicios Publicos (TEBSA), a
240 MW gas-fired generating plant in Barranquilla, Colombia and
began the construction of a new 750 MW gas-fired plant adjacent to
the existing plant (the Barranquilla Project). Electricity
generated by these plants will be sold to Corporacion Electrica de
la Costa Atlantica (Corelca) under a 20-year contract. Total
project costs, including the acquisition of the existing plant,
are approximately $750 million, of which GPU Power's equity
contribution is expected to be approximately $65 million.
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Barranquilla Lease Holdings, Inc.
Barranquilla Lease Holdings, Inc., a subsidiary of GPU
Power, through its wholly-owned subsidiary Los Amigos Leasing
Company, Ltd. (Leaseco), has begun to procure equipment to be used
by and leased to TEBSA. Pursuant to a lease agreement, Leaseco
will deliver certain non-Colombian equipment related to TEBSA, and
TEBSA will make lease payments equal to the interest and principal
payments of Leaseco and certain other expenses incurred by
Leaseco.
EI Australia Services Pty, Ltd. (EI Australia Services)
EI Australia Services, a subsidiary of GPU Electric,
provides operations and management services to Solaris. Currently,
it receives all of its management fees from Solaris in connection
with the development and management of Solaris' operations.
Midlands Electricity plc
In May, 1996, GPU and Cinergy Corp. (Cinergy) formed Avon
Energy Partners plc (Avon), a wholly-owned subsidiary of Avon
Energy Partners Holdings, Inc. (Holdings). Holdings is a 50/50
joint venture formed to acquire Midlands Electricity plc
(Midlands), an English regional electric company (REC). Avon has
made a successful cash tender offer of approximately $2.6 billion
for the outstanding shares of Midlands. GPU's 50% interest in
Holdings is held by EI UK Holdings, Inc. (EI UK), a wholly-owned
subsidiary of GPU Electric.
EI UK and Cinergy have each invested approximately $500
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million in Holdings. EI UK has borrowed approximately $500
million through a GPU guaranteed five-year bank term loan facility
to fund its investment in Holdings. Holdings has borrowed
approximately $1.6 billion through a non-recourse term loan and
revolving credit facility to provide for the balance of the
acquisition price.
Midlands, one of 12 RECs in the United Kingdom, distributes
and supplies electricity to 2.2 million customers in England in an
area with a population of five million. Midlands also owns a
generation business that produces electricity domestically and
internationally and a gas supply company that provides natural gas
service to 8,000 customers in England.
4. Services Obtained From Associated Companies
GPU Energy (formerly known as Metropolitan Edison
Company) and GPU Service, Inc. provided consulting services to EI
Australia Services Pty, Ltd. in the amount of $132,794 and $6,362,
respectively, for the three months ended June 30, 1996, in support
of the development and management of Solaris' operations.
GPU Service, Inc. provided consulting services to GPU Power
in the amount of $26,712 related to the oversight and management
of GPU Power's operations.
GPU Service, Inc. provided consulting services to GPU
Electric in the amount of $104,860 related to the oversight and
management of GPU Electric's operations.
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5. Services Provided to Associated Companies
A description of services provided by GPU Electric to
associate companies during the period April 1, 1996 through June
30, 1996 will be filed separately under a request for confidential
treatment under Rule 104(b).
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SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE PUBLIC UTILITY HOLDING
COMPANY ACT OF 1935, THE UNDERSIGNED COMPANIES HAVE DULY CAUSED
THIS CERTIFICATE TO BE SIGNED ON THEIR BEHALF BY THE UNDERSIGNED
THEREUNTO DULY AUTHORIZED.
GPU, Inc.
By:
T. G. Howson,
Vice President and Treasurer
GPU International, Inc.
By:
B. L. Levy, President
Date: August 30, 1996
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