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Unicom Plans Acquisitions After $5 Billion Power Plant Sale

Unicom Plans Acquisitions After $5 Billion Power Plant Sale

Commonwealth Edison (ComEd) parent Unicom is planning a shopping spree that could include one or several major gas or water distribution companies or a communications company, Unicom Chairman and CEO John W. Rowe said this week at the company's annual meeting.

Unicom will have a large chunk of cash left over from the sale of 9,772 MW in coal- and gas-fired baseload and peaking plants. The company received about $1.76 billion over book value in the largest divestiture yet of a utility's fossil-fueled power plants when Edison International's independent power subsidiary bought the facilities for $5 billion in March.

Unicom plans to use some of the proceeds from that sale to write down the value of its 10 nuclear power plants, but that should not affect the amount of cash on hand for acquisitions.

"1998 was our first year working under the provisions of the Illinois Restructuring Act," said Rowe. "Our earnings beat most expectations, our nuclear fleet surpassed its goals and we clarified our strategic direction.

"Rebounding from our 1997 write-offs, we recorded net income of $510 million or $2.35 per common share in 1998, despite delivering a 15% base rate reduction to our residential customers and dealing with some of the most severe blows Mother Nature and more coincidence could muster," said Rowe. "We also reduced our operating and maintenance expenses by 8% and increased off-system sales revenues by $274 million."

With more than $7 billion in revenue in 1998, Unicom provides service to over 3.4 million customers across northern Illinois or 70% of the state's population.

Rocco Canonica

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