[Federal Register Volume 63, Number 113 (Friday, June 12, 1998)]
[Notices]
[Pages 32271-32272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-15633]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35--26882]


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

June 5, 1998.
    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

[[Page 32272]]

complete statements of the proposed transaction(s) summarized below. 
The application(s) and/or declaration(s) and any amendments is/are 
available for public inspection through the Commission's Office 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 June 29, 1998, to the Secretary, Securities and Exchange 
Commission, Washington, D.C. 20549, 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 case of an attorney at law, by 
certificate) should be filed with the request. Any request for hearing 
should identify specifically the issues of fact 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 June 29, 1998, the application(s) and /or declaration(s), 
as filed or as amended, may be granted and/or permitted to become 
effective.

PP&L Resources, Inc. (70-9165)

    PP&L Resources, Inc. (``Resources''), Two North Ninth Street, 
Allentown, Pennsylvania 18101, a holding company exempt by order under 
section 3(a)(1) of the Act, has filed an application under sections 
9(a)(2) and 10 of the Act for an order authorizing it to acquire all of 
the issued and outstanding common stock of Penn Fuel Gas, Inc. 
(``PFG''), a holding company exempt by order under section 3(a)(1) of 
the Act (``Transaction''). Resources also requests an order under 
section 3(a)(1) exempting it and all of its subsidiary companies from 
all provisions of the Act, except section 9(a)(2), after the 
Transaction is completed.
    Resources is the parent holding company of PP&L, Inc. (``PP&L''). 
PP&L provides electric service to approximately 1.2 million customers 
in its retail service territory in Pennsylvania at retail rates. 
Additionally, PP&L sells electricity at retail throughout Pennsylvania 
under the state's retail access pilot programs. Finally, PP&L markets 
wholesale electric power throughout the eastern United States. PP&L 
operates its generation and transmission facilities as part of the 
Pennsylvania-New Jersey-Maryland Interconnection Association. PP&L is 
subject to regulation by the Pennsylvania Public Utility Commission 
(``PaPUC'') with respect to retail electric rates and other matters.
    PP&L also is a holding company exempt from regulation under the Act 
under section 3(a)(2). PP&L owns 33.3% of the capital stock and 50% of 
the voting stock of Safe Harbor Water Power Corporation (``Safe 
Harbor''), which owns and operates a hydroelectric plant on the 
Susquehanna River in south central Pennsylvania. The entire output of 
the plant is sold to PP&L and Baltimore Gas & Electric, which owns the 
balance of the Safe Harbor capital and voting stock.
    Resources has several nonutility subsidiaries. One subsidiary, PP&L 
Global invests in electric generation, transmission and distribution 
facilities both overseas and domestically.\1\ Another subsidiary, PP&L 
Spectrum, Inc., provides energy-related products and services both 
inside and outside of PP&L's service territory. A third subsidiary, 
Interstate Energy Company, operates oil and gas pipeline facilities 
that supply fuel to a PP&L generating station. Two subsidiaries, Realty 
Company of Pennsylvania and BDW Corporation, own real estate and other 
interests related to the operation of PP&L's generating stations. One 
subsidiary, PP&L Capital Funding, Inc., engages in debt financing 
activities on behalf of Resources. Another subsidiary, CEPT Group, 
Inc., holds passive investments in securities for investment purposes.
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    \1\ Each of the entities invested in by PP&L Global, Inc. is 
either an exempt wholesale generator or a foreign utility company 
under the Act.
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    For the year ended December 31, 1997, Resource's operating revenues 
on a consolidated basis were approximately $3.049 billion, of which 
approximately $90 million was attributable to nonutility activities. 
Resources' consolidated assets at December 31, 1997 were approximately 
$10.0 billion, of which approximately $6.8 billion consisted of net 
electric plant and equipment.
    PFG owns two utility subsidiaries, PFG Gas, Inc. (``PFG Gas'') and 
North Penn Gas Company (``NPG''). PFG Gas provides natural gas 
distribution service to approximately 35,000 customers in Pennsylvania 
and to approximately 200 customers in Maryland. NPG provides natural 
gas distribution service to approximately 34,500 customers in 
Pennsylvania. PFG Gas and NPG also each provide natural gas 
transportation and storage services in Pennsylvania.
    PFG Gas and North Penn are each subject to regulation by the PaPUC 
with respect to rates and other matters. In addition, PFG Gas is 
subject to the jurisdiction of the Maryland Public Service Commission 
with respect to rates and other matters for its utility business 
conducted in that state.
    For the year ended December 31, 1997, PFG's operating revenues on a 
consolidated basis were approximately $119 million, of which 
approximately $106 million were attributable to its gas utility 
operations. Consolidated assets PFG and its subsidiaries as of December 
31, 1997, were approximately $150 million. PFG has no nonutility 
subsidiaries.
    The Transaction will be governed by the terms of a June 26, 1997 
Agreement and Plan of Merger (``Agreement'') by and among Resources, 
Keystone Merger Corp. (``Keystone''), a wholly owned subsidiary of 
Resources, and PFG. Keystone was organized solely for the purpose of 
the Transaction and is not engaged in any business operations. Under 
the terms of the Agreement, Keystone will be merged into PFG and PFG 
will survive as a wholly owned subsidiary of Resources. Each share of 
PFG common stock outstanding prior to the Transaction will be converted 
into the right to receive between 6.968 and 8.516 shares of Resources 
common stock, depending on the market price of Resources common stock 
at the time of closing. PFG common stock shareholders will become 
Resources common stock shareholders, and Resources will become the sole 
holder of all outstanding PFG common stock.
    In addition to its common stock, PFG has issued $1.40 cumulative 
preferred stock (``PFG Preferred''). PFG has undertaken to redeem 
shares of the PFG Preferred in accordance with its terms. PFG Preferred 
shareholders will receive either the redemption price or the right to 
receive between 0.682 and 0.833 shares of Resources common stock, 
depending on the market price of Resources common stock at the time of 
closing.
    Following the Transaction, Resources and each of its public utility 
subsidiaries will be organized in Pennsylvania. Resources contends that 
it will quality for a section 3(a)(1) exemption upon consummation of 
the Transaction. In addition, Resources states that, following the 
Transaction, PP&L will continue to meet the requirements for exemption 
under section 3(a)(2), and PFG will continue to meet the requirements 
for an exemption under section 3(a)(1).

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-15633 Filed 6-11-98; 8:45 am]
BILLING CODE 8010-01-M