[Federal Register Volume 66, Number 35 (Wednesday, February 21, 2001)]
[Notices]
[Pages 11071-11072]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-4258]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-27346]


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

February 14, 2001.
    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 March 12, 2001, 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 March 12, 2001, the application(s) and/or 
declaration(s), as filed or as amended, may be granted and/or permitted 
to become effective.

Alliant Energy Corporation, et al.

[70-9837]

Notice of Proposal To Amend Articles of Incorporation To Issue New 
Preferred Stock; Approve Merger; Increase in Utility Money Pool 
Borrowing Limits and Long-Term Debt Limits; Order Authorizing 
Solicitation of Proxies

    Alliant Energy Corporation (``Alliant''), a registered holding 
company, 222 West Washington Avenue, Madison, Wisconsin 53703, and two 
of its wholly-owned gas and electric utility subsidiary companies, 
Interstate Power Company (``IPC''), 1000 Main Street, P.O. Box 759, 
Dubuque, Iowa 52004, and IES Utilities Inc. (``IESU''), Alliant Energy 
Tower, 200 First Street SE., Cedar Rapids, Iowa 52401, each a public 
utility subsidiary of Alliant (collectively, ``Applicants''), have 
filed an application-declaration under sections 6(a), 7, 9(a), 10, 
12(b), 12(c), 12(d) and 12(e) of the Act and rules 43, 44, 45, 54, 62 
and 65 under the Act.
    Applicants propose to merge IPC into IESU (``Merger'', and the 
surviving company, ``New IESU''). IPC and IESU have operated as an 
interconnected and coordinated electric utility system since 1998 under 
a System Coordination and Operating Agreement (``SCOA'') on file at the 
Federal Energy Regulatory Commission (``FERC''). Under the SCOA, IPC 
and IESU allocate costs for joint dispatch of electric generation 
facilities and certain transmission services are available over their 
combined transmission systems at a single rate.
    Applicants state that the Merger will simplify Alliant's corporate 
structure and reduce corporate and administrative expenses, as well as 
allow New IESU to offer competitive rates to consumers.
    IPC provides electricity to approximately 167,000 customers in 
northern and northeastern Iowa, southern Minnesota, and portions of 
northwestern Illinois. IPC also serves approximately 50,000 natural gas 
customers in Illinois, Minnesota and Iowa. IPC also owns approximately 
2,562 miles of electric transmission lines and 224 substations. Its gas 
transportation and distribution system consists of approximately 91 
miles of pipelines and 916 miles of distribution mains.\1\
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    \1\ IPC's operating revenues for the year ended December 31, 
1999 were $342,105,000, of which $294,381,000 (86%) were derived 
from electric utility operations and $47,724,000 (14%) from gas 
operations.

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[[Page 11072]]

    IESU provides retail electric service to more than 345,000 
customers and retail natural gas service to more than 181,000 customers 
in Iowa. IESU also owns approximately 4,448 miles of electric 
transmission lines and 578 substations which are primarily located in 
Iowa. Its gas distribution system consists of approximately 139 miles 
of pipelines and 3,836 miles of distribution mains.\2\
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    \2\ IESU's operating revenues for the year ended December 31, 
1999 were $800,696,000, of which $627,950,000 (78%) were derived 
from electric utility operations, $145,825,000 (18%) from gas 
operations, and $26,921,000 (4%) from steam and other operations.
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    Applicants propose to solicit proxies from the holders of 
outstanding shares of IESU's preferred stock (``Proxy Solicitation'') 
for use at a special meeting of its stockholders on April 3, 2001, to 
consider the proposed Merger of IPC into IESU, and a proposed amendment 
to IESU's Amended and Restated Articles of Incorporation (``Articles of 
Incorporation'') that will authorize the New Class A Preferred Stock 
(``New Preferred Stock'') to be issued in the Merger.
    On the closing date, IPU will merge with and into IESU.\3\ The 
Merger will be governed by the Agreement and Plan of Merger (``Merger 
Agreement''), as amended, between IESU and IPC, dated March 15, 2000.
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    \3\ The surviving entity will be a wholly owned subsidiary of 
Alliant and will be renamed ``Interstate Power and Light Company'' 
pending approval by shareholder proxy.
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    Under the Merger Agreement, the designations, rights and 
preferences of each series of the New Preferred Stock will be 
substantially identical to the corresponding series of IPC preferred 
stock for which it will be exchanged. The amendment will only authorize 
enough shares of New Preferred Stock as necessary to carry out an 
exchange for the existing shares of IPC preferred stock. At the time of 
the Merger, each share of IPC preferred stock will cease to be 
outstanding and will be converted into and become the right to receive 
one share of New Preferred Stock, to be issued in series that will 
correspond with each series of the former IPC preferred stock.
    After the Merger, IESU will continue to serve IPC's customers and 
will operate as an electric and gas utility company in portions of 
Iowa, Minnesota and Illinois.
    The Merger is subject to affirmative approval by a majority of the 
votes entitled to be cast by the holders of IESU common stock (all of 
which are held by Alliant) and the holders of a majority of the 
outstanding shares of each class of IESU preferred stock voting as 
individual classes. IESU currently has outstanding 366,406 shares of 
cumulative preferred stock par value $50 per share, issued in three 
series (4.30%, 4.80% and 6.10%) (``IESU Preferred Stock''). In 
addition, an amendment to IESU's Articles of Incorporation is necessary 
to consummate the Merger and requires the affirmative vote of at least 
a majority of the outstanding shares of IESU's common stock and of each 
class of the IESU Preferred Stock, all voting as separate classes, in 
attendance at the IESU special meeting on April 3, 2001.
    Approval at the Merger by the IPC shareholders will require the 
affirmative vote of holders of a majority of the outstanding IPC common 
stock (all of which are held by Alliant) and IPC preferred stock 
entitled to vote, voting together as one class. IPC currently has 
outstanding 761,381 shares of cumulative preferred stock, par value $50 
per share, issued in four series (4.36%, 4.68%, 7.76% and 6.40%).\4\
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    \4\ Alliant owns 92.8% of the aggregate voting power of all IPC 
shareowners and intends to vote for approval of the Merger. 
Therefore, approval of the Merger by the IPC shareholders is 
assured.
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    In addition Applicants seek authorization to increase the limits on 
New IESU's borrowings from the intrasystem utility money pool 
(``Utility Money Pool'') and its issuances of long-term secured and 
unsecured debt securities (``Long-Term Debt'').
    By orders dated December 18, 1998 and December 15, 2000 (HCAR Nos. 
26956 and 27307, respectively), the Commission authorized, through June 
30, 2004 (``Authorization Period''), IESU and IPC to incur short-term 
debt by borrowings from the Utility Money Pool in an aggregate amount 
at any time not to exceed $150 million and $100 million, respectively. 
Following the Merger, IPC's borrowing authorization will expire. 
Applicants propose that New IESU'S short-term borrowing limit be 
increased to $250 million. All other terms, conditions and limitations 
under the Utility Money Pool will remain the same.
    By orders dated November 25, 1998 and December 15, 2000 (HCAR Nos. 
26945 and 27306, respectively) (``IESU Orders''), and November 25, 1998 
and December 15, 2000 (HCAR Nos. 26946 and 27305, respectively) (``IPC 
Orders''), the Commission authorized, through the Authorization Period, 
IESU and IPC to issue and sell Long-Term Debt in the form of senior 
unsecured debentures, and unsecured subordinated debentures, collateral 
trust bonds,\5\ and to enter into agreements with respect to tax-exempt 
bonds, in an aggregate amount outstanding not to exceed $200 million 
for IESU and $80 million for IPC. IPC's authorization will expire 
following the Merger. Applicants propose to increase New IESU's Long-
Term Debt to $300 million. All other terms, conditions, and limits will 
remain the same.
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    \5\ The Commission authorized the issuance and sale of 
collateral trust bonds in the IESU Orders but not in the IPC Orders.
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    Applicants request that an order authorizing the solicitation of 
proxies be issued as soon as practicable under rule 62(d). It appears 
to the Commission that the application-declaration relating to the 
proposed solicitation of proxies should be permitted to become 
effective immediately under rule 62(d).
    Alliant Energy states, for purposes of rule 54, that the conditions 
specified in rule 53(a) are satisfied and that none of the adverse 
conditions specified in rule 53(b) exist. As a result, the Commission 
will not consider the effect on the Alliant Energy system of the 
capitalization or earnings of any Alliant Energy subsidiary that is an 
exempt wholesale generator or foreign utility company, as each is 
defined in sections 32 and 33 of the Act, respectively, in determining 
whether to approve the proposed transactions.
    Fees, commissions, and expenses to be incurred in connection with 
the transactions described in the application-declaration concerning 
the Proxy Solicitation are expected not to exceed $206,518 with respect 
to the Proxy Solicitation.
    It is stated that the Merger is subject to the approval of the Iowa 
Utilities Board, the Minnesota Public Utilities Commission, and the 
Illinois Commerce Commission, and the FERC.
    It Is Ordered, under rule 62 under the Act, that the application-
declaration regarding the proposed Proxy Solicitation become effective 
immediately, subject to the terms and conditions contained in rule 24 
under the Act.

For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-4258 Filed 2-20-01; 8:45 am]
BILLING CODE 8010-01-M