[Federal Register Volume 65, Number 203 (Thursday, October 19, 2000)]
[Notices]
[Page 62770]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-26799]


=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-27247]


Filings Under the Public Utility Holding Company Act of 1935, as 
Amended (``Act'')

October 12, 2000.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated under the Act. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendment(s) is/are available for public 
inspection through the Commission's Branch of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
application(s) and/or declaration(s) should submit their views in 
writing by November 6, 2000, to the Secretary, Securities and Exchange 
Commission, Washington, DC 20549-0609, and serve a copy on the relevant 
applicant(s) and/or declarant(s) at the address(es) specified below. 
Proof of service (by affidavit or, in the case of an attorney at law, 
by certificate) should be filed with the request. Any request for 
hearing should identify specifically the issues of facts or law that 
are disputed. A person who so requests will be notified of any hearing, 
if ordered, and will receive a copy of any notice or order issued in 
the matter. After November 6, 2000, the application(s) and/or 
declaration(s), as filed or as amended, may be granted and/or permitted 
to become effective.

PowerGen US Holdings Limited, et al., (70-0763)

    PowerGen US Holdings Limited (``US Holdings'') and PowerGen UK plc 
(``PGUK'' and together, ``Applicants''), both subsidiaries of PowerGen 
plc (``PowerGen''), a public limited company organized under the laws 
of England and Wales, all located at 53 New Broad Street, London EC2M 
1SL, United Kingdom, have filed a declaration under sections 6(a), 7 
and 12(b) of the Act and rules 45 and 54 under the Act.
    In a separate application-declaration in file number 70-9761 
(``9671 Application''), PowerGen proposed to acquire LG&E Energy Corp. 
(``LG&E Energy''), a utility holding company exempt by order \1\ under 
section 3(a) from all provisions of the Act, except section 9(a), and 
all of LG&E Energy's subsidiaries (together ``LG&E Energy Group'') 
(``Merger''). In the 9671 Application, PowerGen has stated that 
intermediate companies will be used in the chain of ownership of the 
LG&E Energy Group (``Intermediate Companies''), including US Holdings, 
primarily for the purpose of creating an economically efficient and 
viable structure for the Merger and the ongoing operations of PowerGen 
and the LG&E Energy Group. Following consummation of the Merger, 
PowerGen and each of the Intermediate Companies intend to register 
under section 5 of the Act as public utility holding companies.
---------------------------------------------------------------------------

    \1\ See LG&E Energy Corp., Holding Co. Act Release No. 26886 
(Apr. 30, 1998).
---------------------------------------------------------------------------

    PowerGen presently intends to finance the acquisition of the LG&E 
Energy Group from, among other things, borrowings under a fully 
committed bank facility that PowerGen and US Holdings established on 
February 27, 2000 (``Credit Facility''). The credit Facility provides 
for up to $4 billion in borrowings by PowerGen, US Holdings and other 
wholly owned subsidiaries of US Holdings as approved in writing by the 
banks. Applicants intend for US Holdings to be the only borrower under 
the Credit Facility, with a guarantee from PowerGen. The Credit 
Facility was established both to fund the acquisition and, if 
necessary, to provide funding and accommodate working capital needs of 
the Intermediate Companies and the LG&E Energy Group.
    Applicants state that PowerGen intends to reduce indebtedness under 
the Credit Facility by, among other things, application of available 
cash or the proceeds of asset sales by PGUK and its subsidiaries, or by 
the issuance of debt securities or other instruments by PowerGen or its 
subsidiaries prior to, at or after the Merger. The Credit Facility 
agreement generally requires that at least 50% of the proceeds from 
those sales in excess of $100 million be applied to repay amounts owing 
under the Credit Facility.
    Applicants state that, due to a United Kingdom law restricting 
dividend payments, the use of loans from PGUK to US Holdings is the 
most efficient and fastest way to move excess funds from PGUK to US 
Holdings. Accordingly, Applicants propose for PGUK, or an intermediate 
parent company of PGUK that PowerGen intends to establish over PGUK, 
PowerGen Group Holdings (``UK Holdings''), to lend to US Holdings the 
net proceeds of asset disposals and other excess capital at PGUK. US 
Holdings will use the loans to repay amounts owed under the Credit 
Facility or, to the extent permitted by the Credit Facility, for other 
corporate purposes.
    Loans by PGUK, or UK Holdings, to US Holdings will be either (a) 
interest free, in the case of loans of funds consisting of the proceeds 
of asset sales or (b) equal to the lender's cost of capital, if the 
funds lent to US Holdings were obtained from borrowings from a third-
party. In addition, the loans to US Holdings will mature in 50 years 
and will have no amortization obligations.
    Applicants state that to the extent that the funds from the loans 
are used to pay down the amounts owing under the Credit Facility, the 
amount of these funds will not count towards the long-term debt 
financing limitation proposed in the 9671 Application. If loan proceeds 
are not used to pay down the amounts owing under the Credit Facility, 
the amount of these proceeds will count towards the long-term debt 
limitation.

    For the Commission by the Division of Investment Management, 
under delegated authority.
Jonathan G. Katz,
Secretary.
[FR Doc. 00-26799 Filed 10-18-00; 8:45 am]
BILLING CODE 8010-01-M