SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): December 17, 1999
PP&L RESOURCES, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Pennsylvania 1-11459 23-2758192
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State or other jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
Two North Ninth Street, Allentown, Pennsylvania 18101-1179
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(Address of principal executive offices)
Registrant's Telephone Number, including Area Code: (610) 774-5151
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(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS
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In 1998, PP&L Global, Inc., a subsidiary of PP&L Resources, Inc., signed
separate agreements with The Montana Power Company, Portland General Electric
Company and Puget Sound Energy, Inc. to acquire interests in 13 Montana power
plants, with 2,372 megawatts of generating capacity, for a purchase price of
$1.546 billion, subject to certain conditions. On December 17, 1999, PP&L
Global acquired certain generation assets from Montana Power through an indirect
subsidiary, PP&L Montana LLC, for a purchase price of $757 million. The assets
acquired include 11 hydroelectric power plants, the Hebgen storage reservoir and
interests in two coal-fired generating stations and other related assets,
totaling 1,315 megawatts of generating capacity. Certain inventories associated
with the power plants were also acquired.
The hydroelectric power plants acquired include the following plants:
Black Eagle, Cochrane, Kerr, Hauser, Holter, Madison, Morony, Mystic, Rainbow,
Ryan and Thompson Falls. The acquisition also included Montana Power interests
in the coal-fired Colstrip generating station and the coal-fired Corette plant.
PP&L Montana continues to proceed with the acquisition of approximately
1,000 additional megawatts of Colstrip generating assets owned by Puget Sound
and Portland General, subject to certain conditions, including receipt of
certain regulatory approvals and third-party consents. Subject to the closing
of these transactions, Montana Power could receive up to an additional $150
million for added value resulting from Montana Power's assets being combined
with those of Puget Sound and Portland General. Montana Power's 241.5-megawatt
leased interest in Colstrip Unit 4 is not included in this transaction, but PP&L
Montana hopes to reach an agreement in the future with Montana Power regarding
this interest. In the meantime, Unit 4's long-term contracts will continue to
be managed by Montana Power.
PP&L Global also has agreed to acquire certain transmission assets related
to the Montana generating assets for an additional $126 million, subject to
certain conditions, including receipt of regulatory approvals.
Upon completion of the Puget Sound and Portland General Colstrip
acquisitions, PP&L Global will have 100% ownership interest in the 13 Montana
power plants, except for Colstrip Units 3 and 4, in which PP&L Global's
ownership interest will be 75% and 45%, respectively. PP&L Global currently
expects to complete the acquisitions of the Puget Sound and Portland General
Colstrip interests by the first quarter of 2000.
As part of this transaction, PP&L Resources also has acquired the
electricity marketing operation of Montana Power. This energy marketing
operation will become part of PP&L EnergyPlus Co., LLC, PP&L Resources'
marketing company, and will sell electricity in both the wholesale and retail
markets in Montana and throughout the Northwest.
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The purchase price for the Montana Power assets was financed, in part,
through an equity infusion of approximately $400 million from PP&L Resources.
PP&L Resources funded its equity investment through debt issued by its
subsidiary, PP&L Capital Funding. The remainder of the acquisition cost was
financed with interim loans made to PP&L Montana by a group of banks. These
bank loans are expected to be refunded with a combination of lease financing and
longer-term debt in 2000.
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SIGNATURE
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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.
PP&L RESOURCES, INC.
Date: December 21, 1999 By: /s/ John R. Biggar
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John R. Biggar
Senior Vice President and
Chief Financial Officer
