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GPU wins PowerNet bid
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October 13, 1997: 12:06 p.m. ET
Electric utility to buy Australian power company, shed non-nuclear assets
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NEW YORK (CNNfn) - The Australian state of Victoria has picked GPU Inc's $1.88 billion bid for its state electrical transmission company.
Under terms of the deal, GPU will acquire PowerNet, which transmits power to that country's second most populous state, in a stock transaction. PowerNet, which is also interconnected with two of Victoria's neighboring states, had revenues of $215 million last year.
GPU, based in Parsippany, N.J., already owns 50 percent of Solaris Power in Australia but will have to sell off its stake due to restrictions on cross-ownership in Australia.
Stateside, GPU has three utility operations, Jersey Central Power & Light, Metropolitan Edison and Pennsylvania Electric, which are combined under the GPU Energy name. Those operations serve 2 million customers and had income of $298 million last year.
Separately, GPU said it would begin selling off its fossil fuel and hydro-generation electricity operations in order to focus on its nuclear holdings.
The deal for PowerNet is expected to be completed by November, while the sale of its non-nuclear assets will take about a year, pending various regulatory approvals.
Some of GPU's nuclear plants are also up for sale. Earlier this year, the company said its Oyster Creek plant could be sold, placed in early retirement or continue operating.
It also is looking to sell off its Three Mile Island Unit 1 nuclear plant, the site of the worst nuclear plant accident in the United States.
GPU said it will pay for PowerNet, as well as its 50 percent acquisition of U.K. utility Midlands Electricity, through a sale of about 7 million shares of stock.
-- Randy Schultz
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