Antitrust

Bankrupt Texas Commercial Energy (TCE) has filed a federal antitrust lawsuit against various electric companies claiming that they violated federal and state law by illegally manipulating the Texas electric market and fraudulently inflating prices.

Kerr-McGee has received antitrust approval for its $1.3 billion acquisition of natural gas producer HS Resources Inc., based in San Francisco. The Oklahoma City independent said it had been granted early termination of the waiting period under the Hart-Scott-Rodino Act, and when completed, Kerr-McGee would join the top five list of leading oil and gas independents, and would up its gas reserves 77%. Kerr-McGee announced in mid-May that it would acquire gas-rich HS Resources for $66 per share (see NGI, May 21). The deal will consist of a 70% cash payment and 30% of Kerr-McGee Stock. Kerr-McGee also will assume about $450 million of HS Resources’ debt. With its core program in the Rockies, HS Resources holds about 1.3 Tcfe in reserves in the Denver-Julesburg Basin of northeast Colorado. With the acquisition, Kerr-McGee said it expected to increase its daily production of U.S. natural gas by more than 45%.

Kerr-McGee has received antitrust approval for its $1.3 billion acquisition of natural gas producer HS Resources Inc., based in San Francisco. The Oklahoma City independent said it had been granted early termination of the waiting period under the Hart-Scott-Rodino Act, and when completed, Kerr-McGee would join the top five list of leading oil and gas independents, and would up its gas reserves 77%.

Just days after winning antitrust clearance from the Departmentof Justice (DOJ), the proposed merger of Philadelphia-based PECOEnergy Co. and Unicom Corp. of Chicago, parent of CommonwealthEdison Co., got more good news last week — it sailed through FERCwithout any conditions attached.

The pending merger of American Electric Power (AEP) of Columbus,OH, and Central and South West Corp. of Dallas, TX, receivedantitrust clearance from the Department of Justice. Approvals thatremain include the Federal Energy Regulatory Commission (FERC), theFederal Communications Commission (FCC) and the Securities andExchange Commission (SEC). Upon completion of the merger, the newcompany will be called American Electric Power.

NiSource said it filed the necessary information under theHart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 with theFederal Trade Commission and Department of Justice regarding itstender offer for all of Columbia Energy Group’s common shares. CEOGary Neale said it “sends a serious message to Columbia that we arecommitted to completing this transaction and that we are confidentin our ability to secure the necessary regulatory approvals. Wehave said throughout that we believe the regulatory approvalprocess can be completed within six to nine months if we worktogether. HSR clearance is an important first step, and one thatconfirms our commitment to move forward on all fronts of thistransaction.” NiSource is offering $68/share for Columbia stock.Columbia’s board has said the company is not for sale and isfighting the hostile takeover attempt (See Daily GPI July 16, July15, June 25, June 11 and June 8).

Exxon and Mobil said yesterday they expect antitrust reviews oftheir proposed $88 billion merger will be completed by the end ofthe third quarter. The companies filed the formal pre-mergernotification with the European Commission on May 3. Under the EC’sregulatory framework, that process should be completed around theend of September. As a result of discussions with the Federal TradeCommission, the companies believe that the FTC process can becompleted in the same time period. Shareholders of both companiesare scheduled to vote on the deal on May 27.

The U.S. Justice Department has kicked off an investigation intoutility-owned ProLiance Energy LLC for possible antitrustviolations in the Midwest pipeline capacity market. The outcome ofthe probe, as well as a decision by an Indiana appellate court onrelated issues, may have ramifications for other utility-ownedmarketers, sources close to the case say.