Merger and acquisition activity in the electric utility industry is practically non-existent in the wake of the turmoil that has exposed the frail financial underpinnings of some companies, says the head of Dominion Resources Inc., one of the few power and natural gas companies to survive the industry upheaval intact and whose stock still remains in the double digits.

“There’s no activity out there in the utility industry that I know of as far as mergers and acquisitions. We’re not looking at anybody. We’re not talking [to anyone],” said Dominion Resources Chairman Thomas E. Capps during a conference sponsored by Merrill Lynch Wednesday in New York. “There [were] some cases that should [have been] acquired, but they were basket cases. They had so much debt that you couldn’t possibly acquire [them even] if they gave themselves to you.”

He said he doubts seriously that congressional repeal of the Public Utility Holding Company Act (PUHCA) will revive M&A activity. Many are counting on it to fuel investment in the lagging utility industry and spur mergers and acquisitions.

As for Richmond, VA-based Dominion Resources, Capps jokingly said the company could be had for a bid of $82.95 a share. “Anybody who wants to come buy us, come in with a bid of $82.95 [in] cash. If it’s stock, we’d probably want a little premium over that.” The company’s stock currently is valued at about $28.

Despite calls by federal lawmakers to limit the use of natural gas in power generation, Capps believes that gas-fueled generation will continue to be the wave of the future. “It’s hard to build anything but a gas unit. You can build wind and you can build sun, but you can’t put wind in a box and sun in a bottle and let it out when you need it. It’s almost impossible to site a new coal plant; we’re tried. Nuclear is out of the question.”

So, the “growth in electricity demand is going to be gas,” he noted.

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