ORANGE-&-ROCKLAND PSC to Gather Public Input on O&R, Con Edison Merger Plan
The New York State Public Service Commission has announced a mid-October schedule of consumer information forums and public statement hearings concerning the proposed merger between Consolidated Edison Inc. and Orange and Rockland Utilities Inc.(O&R), both companies announced today.
On Aug. 20, 1998, O&R's shareholders ratified the $790 million definitive merger agreement according to which Consolidated Edison Inc. will acquire all of O&R's 13,536,000 shares of common stock for $58.50 per share. This price represents a 38% premium over the closing price on May 8, 1998, the last trading day prior to O&R's accepting Con Edison's offer.
Today's public hearing schedules announcement brings the merger, which was first announced May 11, 1998, another step closer to completion. Subject to regulatory approval now being sought, O&R will become a wholly owned subsidiary of Consolidated Edison Inc. upon completion of the transaction, which is expected by the middle of next year.
The companies require FERC approval, SEC approval, and approval from state utility regulators in New York, New Jersey and Pennsylvania. The United States Department of Justice and the Federal Trade Commission also will review the merger. With this combination, Consolidated Edison will serve an area of nearly 2,000 square miles that has a diverse mix of urban and suburban communities. After the completion of the merger, the combined company will provide energy services to nearly 3.3 million electric customers and 1.2 million gas customers in southern New York, including the five boroughs of New York City, Rockland and portions of Orange, Sullivan and Westchester counties, northern New Jersey and northeastern Pennsylvania.
The companies agree that their proposed business combination will benefit customers, employees and the communities they serve. For example, savings resulting from the merger are estimated to total approximately $467 million in 10 years, after accounting for the actual costs of making the merger a reality. The companies propose sharing the savings equally between customers and shareholders. Restructuring plans and rate reductions scheduled as part of each company's Restructuring Agreement will not be affected by the merger.
According to the merger agreement, O&R and Consolidated Edison Company of New York Inc. will be separate, regulated subsidiaries of Consolidated Edison Inc., a holding company. Each regulated company, including Pike County Light & Power Company and Rockland Electric Company, will retain its own rate structure, its own name and be regulated as a separate entity.
The companies have made commitments to maintain high levels of customer service and reliability, provide employees of both companies with continuing opportunities for career development, and continue encouraging the development of competitive energy markets, including the prompt sale (or auction) of their generating assets. The companies also pledged to continue their strong support of community organizations in their respective service territories.
For more information contact Orange and Rockland Utilities Inc.'s Michael Donovan at (914)577-2430.