SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
In the Matter of CERTIFICATE
Cinergy Corp. et al. OF
File No. 70-8933 NOTIFICATION
(Public Utility Holding Company Act of 1935)
With reference to the transactions (a) proposed in the
Application-Declaration on Form U-1, as amended, in the above docket filed
by Cinergy Corp. ("Cinergy"), a Delaware corporation and registered holding
company under the Public Utility Holding Company Act of 1935 (the "Act"),
Cinergy Investments, Inc., a Delaware corporation and direct, wholly-owned
nonutility subsidiary of Cinergy ("Cinergy Investments"), and Cinergy
Services, Inc., a Delaware corporation and direct, wholly-owned service
company subsidiary of Cinergy ("Cinergy Services") and (b) authorized by
the Commission in its order dated February 7, 1997, Rel. No. 35-26662
("Cinergy Solutions Order"), Cinergy Services hereby provides the following
information:
1. The following summary, covering the quarterly period ended December
31, 1999 ("Fourth Quarter 1999"), updates the business activities of
Cinergy Solutions, Inc., a Delaware corporation and direct, wholly-owned
nonutility subsidiary of Cinergy Investments ("Cinergy Solutions"). In
general, the following provides information concerning (i) Cinergy
Solutions itself and (ii) any of its subsidiaries that is not an
"energy-related company" as defined in the Commission's Rule 58 (each, a
"Rule 58 Subsidiary"):/1/
a. Energy Management Services. Cinergy Solutions does not
itself directly market any energy management services. In the Fourth
Quarter 1999, Cinergy Solutions acting through its wholly-owned subsidiary,
Cinergy Business Solutions, Inc. ("CBS"), acquired Rose Technology Group
Limited ("Rose"), a leading Canadian energy services company or "ESCO".
(See the press release attached hereto as Exhibit A.)
Based in Toronto, Rose is one of North America's largest
energy performance contractors. Its business centers on the development of
high performance buildings for institutional and commercial customers that
cost less to own and operate, are more efficient and have less impact on
the environment. Rose has three business lines: facility renewal and
upgrading; new construction; and facility management.
Also an ESCO, CBS provides facility and infrastructure
energy solutions for institutional and industrial customers. CBS focuses
on the customer's facility energy infrastructure processes, and seeks to
identify opportunities for energy process reengineering and applications of
new technology. Prior to the Rose acquisition, CBS met the Rule 58
criteria for an energy-related company and Cinergy had therefore been
reporting its activities on Form U-9C-3.
In connection with the Rose acquisition, Cinergy Solutions
formed several wholly-owned financing entities under Canadian law, 1388368
Ontario Inc. and 3036243 Nova Scotia Company, which entities in turn
established and jointly own another Canadian entity, Cinergy Solutions
Limited Partnership.
Following the Rose acquisition, CBS and Rose changed their
names to Vestar, Inc. and Vestar, Limited, respectively (together,
"Vestar"). Vestar will offer facility and infrastructure services to
institutional, commercial and industrial customers throughout North America
intended to create energy cost savings and improve efficiency and
productivity.
b. Asset Management Services. See the discussion above of
Vestar.
c. Technical/Consulting Services. In 1998 Cinergy Solutions
formed a new, wholly-owned subsidiary, Cinergy Customer Care, Inc., to
market utility billing services and/or utility call center services to
utility companies. However, this subsidiary remained inactive through the
Fourth Quarter 1999.
d. QF Project Development and Ownership. See Cinergy's
quarterly reports on Form U-9C-3 for information concerning Cinergy
Solutions' joint venture with Trigen Energy Corporation.
e. Consumer Services. Cinergy Solutions is no longer offering
its appliance service contract program, called "Appliance Protection Plus."
f. Customer Financing. Effective year-end 1999, Cinergy
Services discontinued marketing its "Quick Credit" financial services
program previously described in this file. Cinergy Solutions is not
otherwise providing any stand-alone customer financing.
g. Third-Party Alliances. See Cinergy's quarterly reports on
Form U-9C-3 for information concerning Cinergy Solutions' joint venture
with Trigen Energy Corporation.
2. During the Fourth Quarter 1999,Cinergy Services provided various
services (including accounting; finance; engineering; executive; legal; and
marketing, sales and customer service) to Cinergy Solutions and its
subsidiaries (including Rule 58 Subsidiaries) for a total cost of
approximately $3,512,000. During that same period, The Cincinnati
Gas & Electric Company and PSI Energy, Inc. provided engineering and
construction services to Cinergy Solutions and its subsidiaries (including
Rule 58 Subsidiaries) totaling approximately $98,000 and $34,000,
respectively.
3. During the Fourth Quarter 1999, (a) Cinergy issued no guarantees of
debt or other obligations of Cinergy Solutions or Vestar, and (b) Cinergy
Investments made net open-account advances to Cinergy Solutions, for the
benefit of Cinergy Solutions and its subsidiaries (including Rule 58
Subsidiaries), totaling approximately $9,314,000 at annual interest rates
ranging from 5.68% to 6.43%.
4. During the Fourth Quarter 1999, neither Cinergy Solutions nor Vestar
entered into any long-term contract by which Cinergy Solutions or Vestar
performs long-term operations, load control or network control of any
electric generation, transmission or distribution facility.
5. Financial statements for Cinergy Solutions dated December 31, 1999
will be included in Cinergy's 1999 Annual Report on Form U5S.
<PAGE>
S I G N A T U R E
Pursuant to the requirements of the Act, the undersigned company has
duly caused this document to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: February 14, 2000
CINERGY SERVICES, INC.
By: /s/Wendy L. Aumiller
Assistant Treasurer
ENDNOTES
/1/ Information regarding Cinergy's Rule 58 Subsidiaries - including any
Rule 58 Subsidiaries held as direct or indirect subsidiaries of Cinergy
Solutions (such as the various subsidiaries jointly-owned with Trigen
Energy Corporation) - is contained in Cinergy's quarterly reports filed on
Form U-9C-3.
Exhibit A
News contact: Steve Brash 513-287-2226 (w) 513-231-6895 (h)
Angeline Protogere 317-838-1338 (w) 317-298-3090 (h)
Investor Contact: Steve Schrader 513-287-1083
Web site: www.cinergysolutions.com
FOR IMMEDIATE RELEASE January 18, 2000
CINERGY BUSINESS SOLUTIONS ACQUIRES ROSE TECHNOLOGY GROUP
CINCINNATI Cinergy Business Solutions, an affiliate of Cinergy
Corp.(NYSE:CIN), announced today that it has acquired the leading
Canadianperformance contracting company, Rose Technology Group.
The newly combined company will be called Vestar and will offer
facility and infrastructure solutions to institutional, commercial and
industrial customers throughout North America. The name, Vestar, reflects
the new organization's investment in finding ingenious ways to deliver
solutions to its clients, creating tangible benefits such as cost savings
and improved efficiency and productivity.
Vestar will be headquartered in Cincinnati, Oh., with offices in
Pittsburgh, Pa., Toronto, Ont., and other locations throughout Canada.
Terms of the transaction were not disclosed.
"Cinergy is very pleased to welcome Rose Technology into our growing
family of energy businesses," said James E. Rogers, vice chairman,
president and chief executive officer of Cinergy Corp. "Vestar allows us
to compete effectively in the Energy Services market by bringing together
complementary knowledge, skills and market segments into a single
organization."
"The combination of Rose Technology Group and Cinergy Business
Solutions provides the solid platform necessary for realizing our mission
to be the leading developer of high performance buildings in North
America," said Ian A. Jarvis, president and chief executive officer of Rose
Technology Group. "We will continue to expand the economic, social and
environmental benefits which we provide to our clients and to society at
large. What will change is the substantially greater depth of resources
and capabilities which we can provide to our clients, business partners and
suppliers."
"Vestar brings together the strengths of Cinergy Business Solutions'
creative and innovative services to industrial customers with Rose
Technology Group's experience and strong engineering competency in
implementing solutions for institutional and commercial customers," said
Leland Smith, president of Cinergy Business Solutions, who will also serve
as president of Vestar. "Rose's solid track record of delivering results
with their process driven procurement and construction group will be
expanded into the industrial market. The new company will be uniquely
positioned to provide the most value to all our customers."
Rose Technology Group's area of expertise centers on the development
of high performance buildings that cost less to own and operate, are more
efficient and have less impact on the environment. Rose, based in Toronto,
Ont., is one of North America's largest performance contractors and
features three business lines: facility renewal and upgrading, new
construction and facility management. It has approximately 150 employees
in locations across Canada. It received the 1999 Frost & Sullivan Market
Engineering Leadership Award for Canada.
Cinergy Business Solutions is a professional service firm with a staff
of 36 specializing in facility and infrastructure solutions. It provides
creativity and innovation as well as new approaches, concepts and
technologies to improve utilization of its clients' resources. Its unique
Facility Resource PlanningTM or FRPTM process focuses on the customer's
facility energy infrastructure processes and finds self-funding
opportunities for energy process re-engineering and the appropriate
applications of new technology.
Cinergy Corp. is one of the nation's leading diversified energy
companies. Its operating companies, The Cincinnati Gas & Electric Company
and PSI Energy, Inc., serve more than 1.4 million electric customers and
470,000 gas customers in Indiana, Ohio and Kentucky.
