Nov. 1, 2002 — The United Illuminating Co., (UI), a wholly owned subsidiary of UIL Holdings Corp., on Friday announced the completion of the sale of its ownership and leasehold interests in the Seabrook Nuclear Generating Station to FPL Group, Inc.
UI held ownership and leasehold interests totaling 17.5% (203.18 megawatts) in Seabrook Station. The sale was done through an auction process in which JPMorgan Securities, Inc. acted as the exclusive auction agent and financial advisor for the New Hampshire Public Utilities Commission, in coordination with the Connecticut Department of Public Utility Control (DPUC). Seabrook Station will now become a part of FPL Energy, the independent power producer subsidiary of FPL Group, Inc.
In April 1998, Connecticut enacted Public Act 98-28 (the Restructuring Act), which required UI to sell its fossil-fueled generating plants and divest its ownership interests in its nuclear-fueled power plants prior to 2004 in order to recover any stranded costs associated with its power plants. “The sale of our interests in the Seabrook Nuclear Generating Station completes the divestiture of our generation assets,” commented Nathaniel D. Woodson, UI Chairman and Chief Executive Officer. “It has been a long process, but I am pleased that UI has been able to comply with the legislation, while remaining a strong company.”
The proceeds from the sale of UI’s interests in the plant will be used to terminate the lease and redeem the sale leaseback obligation bonds. In compliance with the Restructuring Act, any net-of-tax gain from this sale, after termination of the sale/leaseback agreement, that is in excess of the book value of the plant, as set by the DPUC, based on its estimate of the market value of the plant, will be used to reduce UI’s stranded costs. Accordingly, there should be no direct contemporaneous impact on UI’s financial condition as a result of the sale.
UI is a New Haven-based regional distribution utility that provides electricity and energy-related services to more than 318,000 customers in municipalities in the Greater New Haven and Greater Bridgeport areas. UI’s World Wide Web address is https://uinet.com. UI’s parent company, UIL Holdings Corporation, is traded on the New York Stock Exchange under the symbol UIL.