UNITED STATES 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): February 24, 1997
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SOUTHWESTERN PUBLIC SERVICE COMPANY
(Exact name of registrant as specified in its charter)
New Mexico 1-3789 75-0575400
(State or other jurisdiction of (Commission File No.) (I.R.S. Employer
incorporation or organization) Identification No.)
Tyler at Sixth, Amarillo, Texas 79101
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (806)378-2121
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ITEM 5. OTHER EVENTS
In August 1995, Southwestern Public Service Company (the "Company") and
Public Service Company of Colorado ("PSCo") announced that they had entered into
a definitive merger agreement which provided for a "merger of equals" of the
Company and PSCo. (For more information regarding the merger, see the Company's
Annual Report on Form 10-K for the fiscal year ended August 31, 1996.) Reference
is made to the press release filed as an exhibit hereto for information with
respect to the joint offer by PSCo and American Electric Power ("AEP") to
acquire Yorkshire Electricity Group plc in the United Kingdom.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits. The following exhibits are filed herewith:
99 Press Release, dated February 24, 1997, of AEP and PSCo.
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, thereunto duly authorized.
SOUTHWESTERN PUBLIC SERVICE COMPANY
By /s/ Doyle R. Bunch, II
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Name: Doyle R. Bunch, II
Title: Executive Vice President
Accounting and Corporate
Development
DATE: February 24, 1997
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EXHIBIT INDEX
Exhibit
Number
99 Press Release, dated February 24, 1997, of American Electric Power and
Public Service Company of Colorado.
EXHIBIT 99
NEWS RELEASE
FOR FURTHER INFORMATION, CONTACT:
Media: Pat D. Hemlepp Analysts: John Bilacic
Manager, Media Relations Mgr., Investor Relations
AEP AEP
614/223-1620 614/223-2847
Cynthia Evans Mike Pritchard
Managing Director, Asst. Treasurer
Corporate Communications Mgr., Investor Relations
PSCo PSCo
303/294-8688 303/294-2588
FOR IMMEDIATE RELEASE
AEP, PSCo OFFER
TO ACQUIRE YORKSHIRE ELECTRICITY GROUP plc IN U.K.
LONDON, Monday, February 24,1997 -- American Electric Power (NYSE: AEP) and
Public Service Company of Colorado (NYSE: PSR) have jointly agreed with the
Board of Directors of Yorkshire Electricity Group plc in the United Kingdom to
make a cash tender offer for Yorkshire Electricity, the companies' chief
executives announced today.
AEP and Public Service Company of Colorado (PSCo), through a joint venture
named Yorkshire Holdings plc, are offering the equivalent of US $15.02 (9.27
pounds) per ordinary share for Yorkshire Electricity Group, valuing the company
at approximately US $2.4 billion (1.5 billion pounds). The AEP, PSCo, and
Yorkshire Electricity boards have approved the transaction.
E. Linn Draper, AEP chairman, president and chief executive officer, will
initially be chairman of Yorkshire Holdings plc. Wayne H. Brunetti, PSCo
president and chief executive officer, will initially be vice chairman of
Yorkshire Holdings plc. Malcolm Chatwin, Yorkshire Electricity Group's chief
executive, has agreed to continue in that capacity.
AEP and PSCo are convinced that the acquisition of Yorkshire Electricity
represents an excellent opportunity to expand both companies' interests in
competitive markets internationally. They believe they can both add to Yorkshire
Electricity Group's aspirations in the U.K. They believe they can also learn
valuable skills and together look at other opportunities in the U.K. and further
afield.
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E. Linn Draper said, "We have been actively working to lead the transition
to competition in the U.S. market and have, in Yorkshire Electricity Group,
found a partner that is committed to similar customer service and reliability at
a reasonable cost. Yorkshire Electricity Group has performed well in these areas
and we expect that our collective expertise should benefit all customers. This
is another step for AEP to meet its key strategy of achieving shareholder value
and to enhance AEP's core competencies."
Wayne H. Brunetti said, "This competitive approach also is behind PSCo's
pending merger with Southwestern Public Service Company to create New Century
Energies, Inc. The full value of our offer is in recognition of the competitive
strengths of Yorkshire Electricity Group. We look forward to harnessing our
combined talents to the benefit of shareholders, employees and customers."
Yorkshire Electricity Group is one of two remaining English independent
regional electricity companies. The British government privatized the
electricity industry in 1990, creating 12 regional electricity companies in
England. Six have been acquired by companies involved in the U.S. energy
industry. Four have been acquired by companies in the U.K.
The U.K. is ahead of the United States in deregulation of the electric
industry. By April 1998, all customers in the U.K. are expected to be able to
choose their electricity supplier.
Yorkshire Electricity Group's principal activities are the distribution of
electricity to 2.1 million industrial, commercial, agricultural and domestic
customers in its authorized area, which covers 4,180 square miles of northeast
England. Yorkshire Electricity Group is also active in electricity supply and
generation and the supply of gas, including the ownership of gas assets. Other
activities include the development of telecommunications services and the
construction and operation of windfarms.
For the year ended March 31, 1996, Yorkshire Electricity Group reported a
consolidated profit on ordinary activities before taxation and exceptional items
of approximately US $310.8 million (199.2 million pounds) and had assets at that
date of approximately US $2.2 billion (1.4 billion pounds).
AEP will make its investment in Yorkshire Electricity through its AEP
Resources, Inc. subsidiary, which owns, operates and invests in electric
facilities domestically and abroad. PSCo's investment will be made through its
newly formed, wholly-owned subsidiary New Century International Inc.
The acquisition will be financed through a combination of 25 percent equity
and 75 percent debt, including assumption of the existing debt of Yorkshire
Electricity. AEP and PSCo will each invest approximately US $360 million (220
million pounds) in the venture. The remaining US $1.7 billion (1.1 billion
pounds) will be provided by a non-recourse loan to Yorkshire Power Group plc.
The partners have hedged the exchange rate risk for the purchase.
Merrill Lynch is financial advisor to Yorkshire Holdings plc and has
arranged financing for the acquisition.
AEP, one of the nation's largest investor-owned utilities, is engaged in
the generation, transmission and distribution of electric energy to 7 million
people in Indiana, Kentucky, Michigan, Ohio, Tennessee, Virginia and West
Virginia. In addition, wholly-owned subsidiaries provide power engineering,
consulting and management services throughout the world.
In the year ended Dec. 31, 1996, AEP supplied 132,573,000 megawatt hours of
electricity and reported net income of US $587.4 million on operating revenues
of more than US $5.8 billion.
PSCo is an investor-owned electric and natural gas utility, which serves an
area with a population of approximately 3 million people throughout Colorado and
Cheyenne, Wyoming. Headquartered in Denver, Colorado, the company operates an
integrated electric utility system with net generating capability of
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approximately 3300 MW and which had a peak load of approximately 4400 MW in
1996, and an extensive natural gas system.
For the year ended Dec. 31, 1996, PSCo reported net income of US $190.3
million on revenues of US $2.17 billion.
In August 1995, PSCo and Southwestern Public Service Company announced that
they had entered into a definitive merger agreement to combine these two
low-cost utilities and form a Denver-based energy services holding company (New
Century Energies, Inc.). Its service territory will encompass portions of six
states. The combined company will employ approximately 6,200 employees.
Based in Amarillo, Texas, Southwestern Public Service is an investor owned
utility that provides electric service to a population of about one million
people in eastern and southeastern New Mexico, the South Plains and Panhandle of
Texas, the Oklahoma Panhandle and southwestern Kansas.
E. Linn Draper and Wayne H. Brunetti will be available at 10 a.m. EST (8
a.m. MST) for a conference call for U.S. media and analysts. The toll-free
number to call is 1-888-228-3797, with participants accepted between 9:45 and 10
a.m. Wayne H. Brunetti of PSCo and Donald M. Clements, president of AEP
Resources, will be available at 1 p.m. EST (11 a.m. MST) at 1-888-886-7043 with
participants accepted between 12:45 and 1 p.m. for western U.S. media and
analysts unable to participate in the first conference call.
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News releases and other information about AEP or PSCo can be found on the
World Wide Web. AEP's internet site is http://www.aep.com; PSCo's is
http://www.psco.com.
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The offer to purchase shares of Yorkshire Electricity will not be made,
directly or indirectly, in or into, or by use of the mails or any means or
instrumentality (including without limitation, facsimile transmission, telex or
telephone) of interstate or foreign commerce of, or any facilities of a national
securities exchange of, the United States and will not be capable of acceptance
by any such use, means, instrumentality or facilities within the United States.
Nothing herein shall be deemed to constitute an offer to purchase shares of
Yorkshire Electricity from persons in the United States.
