17 October 2002 – Kansas-based Aquila, Inc. reported additional asset sales Wednesday under its previously announced restructuring programme, bringing the current total of assets it has sold or agreed to sell to $976.6m. The company’s stated goal since May has been to sell at least $1bn in assets to strengthen its balance sheet and credit.
“We are continuing to focus on our transition back to our roots as a regulated utility company and our exit from the elements of our previous energy merchant strategy that are not consistent with our current business model,” said Aquila Chairman, President and Chief Executive Officer Richard C. Green, Jr.
An Aquila subsidiary has sold to Black Hills Corporation for $30.5m a credit facility it provided to Mallon Resources Corporation and Mallon Oil Company in 1999. The financing was for development of oil and gas properties in New Mexico.
On October 15, Aquila sold 8 million common shares of Quanta Services, Inc.) for $3.00 per share in a privately negotiated transaction. Through open market and private sales since July, Aquila has sold more than 16m Quanta shares for total proceeds of out $44m. It now holds approximately 12.8m shares and has a 14.3 per cent equity interest in Quanta, which builds and maintains energy and communications networks across the United States.
As part of the ongoing reduction in Aquila’s energy marketing and trading activities, the company is on track with plans to close its European headquarters in London and its office in Essen, Germany by the end of this month. The office in Sandefjord, Norway has been closed and all of Aquila’s trading through Nord Pool, the trading organization that handles energy in Scandinavia, has ceased. Aquila also has terminated or restructured the majority of its historical trading positions in Europe and the remainder will be managed by Capacity Services staff at its headquarters in Kansas City.
Of the total and planned asset sales, some $796.6m have already closed, the company said.